Lovely video from Justin Bender (B. Comm, CFA, CFP®, TEP), a portfolio manager at PWL Capital Inc., that looks under the hood of $FEQT to help investors understand why it behaves the way it has, and whether investors should expect that to continue. Prior to watching the video, my understanding of FEQT was that it's a fund-of-funds that utilizes a factor-orientated (or "factor tilt") approach to screen for stocks across various geographical regions within its investment universe, with an additional allocation to global small-caps and Bitcoin. The overall goal of the fund is to ultimately provide investors exposure to a globally diversified, multi-asset strategy designed with the potential (not guarantee) to achieve better risk-adjusted returns compared to a traditional, passive, broad market strategy. But how does FEQT actually go about doing this? Turns out, its structure is much more complex than one might have initially thought! Topics Covered (in 15 min): • How Fidelity selects its stocks • Why Fidelity tilts toward value, momentum, quality and low volatility • How sector weights are adjusted • Why large companies are added back into the portfolio • The role of Bitcoin and active small-cap management • Whether the higher MER is justified • Diversification and tax considerations • What the historical backtests really tell us • A factor regression analysis showing what has actually driven returns Posting to Blossom Social to provide the video additional exposure as it's very well-done, educational, and quite frankly, kilometers/miles ahead, in terms of depth and content quality, in comparison with what you see from the majority of investment-related content across social media: https://www.youtube.com/watch?v=fQJjG_pFcLY
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