Fidelity Value Factor ETF: A Smart Beta Option for Value Investors

The Fidelity Value Factor ETF (FVAL) is a smart beta ETF that seeks to track the performance of large and mid-capitalization US companies with attractive valuations. It was launched on 09/12/2016 and has a total asset size of $977.06 million. The ETF has a 0.16% annual operating expense and a 12-month trailing dividend yield of 1.55%. Its top holdings include Microsoft Corp (7.22%), Nvidia Corp (6.63%), and Apple Inc (6.54%). The ETF is managed by Fidelity and aims to match the performance of the Fidelity U.S. Value Factor Index before fees and expenses.

The Fidelity Value Factor ETF (FVAL) is a smart beta exchange-traded fund (ETF) that provides broad exposure to the Large Cap Value segment of the US equity market. Launched on September 12, 2016, FVAL has amassed assets of $976.98 million, positioning it as an average-sized ETF within this segment [1].

Key Features of FVAL

1. Investment Objective: FVAL seeks to track the performance of the Fidelity U.S. Value Factor Index before fees and expenses. This index reflects the performance of large and mid-cap US companies that exhibit attractive valuations.

2. Expense Ratio: The ETF has an annual operating expense ratio of 0.16%, making it one of the cheaper products in the space [1].

3. Dividend Yield: FVAL offers a 12-month trailing dividend yield of 1.55%, providing a modest income stream for investors [1].

4. Top Holdings: The fund's top holdings include Microsoft Corp (MSFT) at 7.22%, Nvidia Corp (NVDA) at 6.63%, and Apple Inc (AAPL) at 6.54%. These holdings contribute significantly to the fund's performance and diversification [1].

Performance and Risk

FVAL has demonstrated robust performance, adding roughly 5.16% so far this year and achieving a one-year return of about 10.10% (as of July 16, 2025). Over the past 52 weeks, the ETF has traded between $52.80 and $65. The ETF's beta of 0.96 and a standard deviation of 16.59% for the trailing three-year period indicate a moderate level of risk compared to the broader market [1].

Sector Exposure

FVAL has a significant allocation to the Information Technology sector, accounting for about 31.50% of its portfolio. Financials and Consumer Discretionary sectors also feature prominently in the top three holdings [1].

Alternative ETFs

Investors seeking similar exposure might consider other ETFs such as the Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV). Schwab U.S. Dividend Equity ETF has $70.24 billion in assets and an expense ratio of 0.06%, while the Vanguard Value ETF has $138.31 billion in assets and charges 0.04% [1].

Conclusion

Fidelity Value Factor ETF (FVAL) offers a cost-effective and diversified way to gain exposure to the Large Cap Value segment of the US equity market. With a focus on large and mid-cap companies with attractive valuations, FVAL provides a balanced investment option for long-term investors. Its low expense ratio and modest dividend yield make it an attractive choice for those seeking a stable and diversified investment vehicle.

References

[1] https://finance.yahoo.com/news/fidelity-value-factor-etf-fval-102005539.html