Fidelity launches Paris-aligned fixed income ETFs

Expanding the firm’s Article 9 range


Hannah Williford

Fidelity International has launched two active fixed income ETFs with a focus on sustainable investing, classified as Article 9 under the Sustainable Finance Disclosure Regulation.

Fidelity Sustainable EUR Corporate Bond – Paris Aligned Multifactor Ucits ETF and Fidelity Sustainable USD Corporate Bond – Paris Aligned Multifactor Ucits ETF were listed on 23 October on the London Stock Exchange and Xetra.

Fidelity said the aim for the funds is to follow the Paris Agreement goals for carbon emissions.

Both funds come with a 0.2% ongoing charges figure (OCF), rising to 0.25% for their respective currency hedged versions.

The USD fund will be benchmarked against the Solactive USD Corporate IG PAB Index, while the EUR fund will track the Solactive Euro Corporate IG PAB Index.

The Solactive benchmarks have a self-decarbonisation trajectory of at least 7% each year, which is reviewed semi-annually in January and July.

Fidelity currently offers two other Article 9 ETFs, the Fidelity Sustainable Global Corporate Bond Paris-Aligned Multifactor Ucits ETF and Fidelity Sustainable Global High Yield Bond Paris-Aligned Multifactor Ucits ETF.

Stefan Kuhn, head of Europe ETF distribution, recognised the growth of ETF offerings in recent years, from $200bn (£164.6bn) globally in 2003 to $9.5trn (£7.8trn) in 2022.   

“Since launch in 2021, our Sustainable Global Corporate Bond Multifactor Ucits ETF has proved popular with clients, utilising Fidelity’s active research platform and our sustainability expertise to identify best-in-class corporate bonds at an attractive price point,” Kuhn said.

“We are pleased to expand on this to include regional variations of the successful strategy, in line with client demand.”

As of June 2023, Fidelity managed $744.8bn (£612.77bn) assets. In September, the firm also launched two active Article 9 funds, The Fidelity Funds Sustainable Global Equity fund and the Fidelity Funds Sustainable Asian Focus fund.

This article was originally published on ESG Clarity’s sister title Portfolio Adviser.

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