ETF Evaluator: Fidelity Fundamental Emerging Mkts ETF () Follow This ETF

Fidelity Fundamental Emerging Mkts ETF Overview

Fidelity Fundamental Emerging Mkts ETF (FFEM) is an actively managed International Equity Diversified Emerging Mkts exchange-traded fund (ETF). Fidelity Investments launched the ETF in 2024.

The investment seeks long-term growth of capital. Normally investing at least 80% of assets in securities of issuers and in depositary receipts representing securities of issuers in emerging markets and other investments that are tied economically to emerging markets. Emerging markets include countries that have an emerging stock market as defined by MSCI, countries or markets with low- to middle-income economies as classified by the World Bank, and other countries or markets that the Adviser identifies as having similar emerging markets characteristics. The fund is non-diversified.

About Fidelity Fundamental Emerging Mkts ETF (FFEM)

There are 3 members of the management team with an average tenure of 1.70 years: Timothy Gannon (2024), Michael Kim (2024) and Ned Salter (2024). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 1 primary benchmark: MSCI EM NR USD index with a weighting of 100%. Fidelity Fundamental Emerging Mkts ETF has 120 securities in its portfolio. The top 10 holdings constitute 51.3% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a nondiversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

Fidelity Fundamental Emerging Mkts ETF is part of the Equity global asset class and is within the International Equity ETF group. Fidelity Fundamental Emerging Mkts ETF has 96.8% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 2.1% There is 96.8% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 0.0% (0.0% domestic bond, 0.0% foreign bond and 0.0% convertible bond). Fidelity Fundamental Emerging Mkts ETF has 2.8% of the portfolio in cash.

Assets Under Management

The fund has $62 million in total assets, which is below the $3 billion average for the Diversified Emerging Mkts category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

FFEM Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Fidelity Fundamental Emerging Mkts ETF expense ratio is above average compared to funds in the Diversified Emerging Mkts category. Fidelity Fundamental Emerging Mkts ETF has an expense ratio of 0.60%, which is 16% higher than its category average, making the fund expense ratio grade a C. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Fidelity Fundamental Emerging Mkts ETF has a portfolio turnover rate of 52%, which indicates that it holds its assets around / 0.0 years. By way of comparison, the average portfolio turnover is 44% for the Diversified Emerging Mkts category.

Recently, in the month of July 2026, Fidelity Fundamental Emerging Mkts ETF returned -3.4%, which earned it a grade of C, as the Diversified Emerging Mkts category had an average return of -3.0%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

Fidelity Fundamental Emerging Mkts ETF has a trailing yield of 1.26%, which is below the 2.41% category average. The fund normally distributes its income quarterly and its capital gains annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Fidelity Fundamental Emerging Mkts ETF Grades

Year to date, the ETF has returned 24.9%, 7.8 percentage points better than the category, which translates into a grade of A. The fund has returned 46.9% over the past year (grade of A).

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