Fidelity's Commission-Free ETF Platform Is Growing

In its latest effort to cement its status as a low-cost leader in the exchange traded funds space, Fidelity is making substantial additions to its lineup of ETFs offered to clients on a commission-free basis.

What Happened

Boston-based Fidelity said Tuesday it's expanding its commission-free ETF suite to over 500 funds, matching a similar move announced the same day by rival Charles Schwab Corp. SCHW.

The additions to Fidelity's suite of commission-free ETFs are iShares funds. Fidelity's roster of ETFs available with no commissions consists exclusively of the firm's own ETFs and iShares products. The additional iShares ETFs will debut on the Fidelity platform on February 28.

Why It's Important

“Fidelity’s platform also will provide more choice in the smart beta and active ETF categories from more than ten asset managers and leading ETF providers in the coming months,” said the issuer in a statement.

The firm currently offers smart beta products, such as the Fidelity High Dividend ETF FDVV and the Fidelity Low Volatility Factor ETF FDLO, commission-free. Fidelity also offers the sector ETFs with the industry's lowest expense ratios, all of which the firm does not charge commissions on.

Last year, Fidelity introduced the Fidelity ZERO Total Market Index Fund (FZROX), Fidelity ZERO International Index Fund (FZILX), Fidelity ZERO Large Cap Index Fund (FNILX), and Fidelity ZERO Extended Market Index Fund (FZIPX) – the fund industry's first ever zero fee index funds.

What's Next

Fidelity has $6.7 trillion in assets under administration including custodied ETF assets of more than $380 billion. As of Feb. 11, Fidelity's ETFs had $12.16 billion in combined assets under management, making the company the 15th-largest U.S. ETF sponsor.

Prior to Tuesday's announcement, Fidelity offered 265 ETFs, including 240 iShares funds, to its clients on a commission-free basis.

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