Fidelity Investments is one of the largest and most reputable financial services companies in the world, with over $3 trillion in assets under management. As a leading investment management firm, Fidelity offers a wide range of investment products and services to individual and institutional investors. But have you ever wondered what Fidelity invests in? In this article, we’ll take a closer look at the various asset classes and investment strategies that Fidelity employs to help its clients achieve their financial goals.
Stocks and Equities
Fidelity is perhaps best known for its stock investment offerings. The company has a long history of investing in equities, dating back to its founding in 1946. Today, Fidelity’s equity portfolio is one of the largest and most diversified in the world, with investments in thousands of publicly traded companies across a wide range of industries and sectors.
Within its equity portfolio, Fidelity invests in a variety of strategies, including:
- Active management: Fidelity’s active equity managers use a combination of fundamental research, quantitative analysis, and market insights to select stocks that they believe will outperform the broader market.
- Indexing: Fidelity also offers a range of index funds and ETFs that track popular market benchmarks, such as the S&P 500 or the Russell 2000.
- Sector-specific investing: Fidelity’s sector-specific funds focus on specific industries or sectors, such as technology, healthcare, or financials.
Some of the specific stocks that Fidelity invests in include:
| Company | Industry |
|---|---|
| Apple Inc. | Technology |
| Johnson & Johnson | Healthcare |
| Visa Inc. | Financials |
Bonds and Fixed Income
In addition to its equity portfolio, Fidelity also invests in a wide range of bond and fixed-income securities. These investments offer a relatively stable source of income and can help to reduce the overall risk of a portfolio.
Fidelity’s fixed-income portfolio includes:
- Government bonds: Fidelity invests in bonds issued by governments around the world, including U.S. Treasuries, municipal bonds, and sovereign debt.
- Corporate bonds: Fidelity also invests in bonds issued by corporations, which offer a higher yield than government bonds but also come with a higher level of credit risk.
- Mortgage-backed securities: Fidelity invests in mortgage-backed securities, which are backed by the cash flows from pools of mortgages.
- High-yield bonds: Fidelity’s high-yield bond funds invest in bonds issued by companies with lower credit ratings, which offer higher yields to compensate for the increased credit risk.
Alternatives and Real Assets
In addition to traditional stocks and bonds, Fidelity also invests in a range of alternative assets and real assets. These investments can help to diversify a portfolio and reduce its reliance on traditional asset classes.
Some of the alternative assets and real assets that Fidelity invests in include:
- Real estate: Fidelity invests in real estate investment trusts (REITs) and other real estate-related securities, which offer a way to invest in the property market without directly owning physical real estate.
- Commodities: Fidelity invests in commodity futures, options, and ETFs, which provide exposure to the prices of natural resources, such as oil, gold, and agricultural products.
- Private equity: Fidelity invests in private equity funds, which provide capital to private companies and offer the potential for higher returns over the long term.
- Hedge funds: Fidelity also invests in hedge funds, which use a range of strategies to generate returns, including long-short equity, global macro, and event-driven investing.
International Investments
As a global investment manager, Fidelity invests in securities from around the world. The company’s international investment portfolio includes:
- Developed markets: Fidelity invests in securities from developed markets, such as Europe, Japan, and Canada.
- Emerging markets: Fidelity also invests in securities from emerging markets, such as China, India, and Brazil.
- Currency management: Fidelity’s currency management team actively manages the company’s currency exposure to help maximize returns and minimize risk.
Sustainable and ESG Investing
In recent years, Fidelity has placed a growing emphasis on sustainable and ESG (environmental, social, and governance) investing. The company offers a range of sustainable and ESG investment products, including:
- ESG equity funds: Fidelity’s ESG equity funds invest in companies that meet certain ESG criteria, such as strong governance practices, environmental stewardship, and social responsibility.
- Sustainable bond funds: Fidelity’s sustainable bond funds invest in bonds issued by companies and governments that pursue sustainable projects and practices.
- Impact investing: Fidelity’s impact investing approach seeks to generate both financial returns and positive social or environmental impact.
Multi-Asset and Alternatives
Fidelity also offers a range of multi-asset and alternative investment products, which combine different asset classes and strategies to provide a more diversified portfolio.
Some of the multi-asset and alternative investment products that Fidelity offers include:
- Asset allocation funds: Fidelity’s asset allocation funds provide a single, diversified portfolio that includes a mix of stocks, bonds, and other asset classes.
- Alternative mutual funds: Fidelity’s alternative mutual funds invest in a range of alternative assets, including private equity, hedge funds, and real assets.
- Long-short equity funds: Fidelity’s long-short equity funds use a combination of long and short positions to generate returns, regardless of the direction of the overall market.
Conclusion
Fidelity Investments is a highly diversified investment management firm that invests in a wide range of asset classes, sectors, and geographies. From traditional stocks and bonds to alternative assets and real assets, Fidelity’s investment portfolio is designed to provide a broad range of investment opportunities for its clients. Whether you’re a individual investor or an institutional client, Fidelity’s investment expertise and global reach can help you achieve your financial goals.
What is Fidelity’s investment approach?
Fidelity’s investment approach is centered around diversification, which means spreading investments across different asset classes, sectors, and geographies to minimize risk and maximize returns. This approach is designed to help investors achieve their long-term financial goals by providing a stable source of income and growth.
Fidelity’s investment experts actively monitor market trends and economic conditions to identify opportunities that align with their investment objectives. They invest in a range of assets, including stocks, bonds, real estate, commodities, and alternative investments, to create a diversified portfolio that can weather different market conditions.
What role do equities play in Fidelity’s portfolio?
Equities, or stocks, are a key component of Fidelity’s investment portfolio. They offer the potential for long-term growth and income, and can help investors achieve their financial goals. Fidelity’s investment team actively selects individual stocks and equity funds that they believe have strong growth potential and are undervalued by the market.
By investing in a diversified range of equities, Fidelity aims to balance risk and return, and to provide a stable source of income and growth over the long term. This includes investing in domestic and international equities, as well as in different sectors and industries, to spread risk and maximize returns.
How does Fidelity approach fixed income investing?
Fidelity’s fixed income investing approach is centered around generating consistent income and preserving capital. They invest in a range of fixed income securities, including government bonds, corporate bonds, and other debt instruments, to provide a stable source of income and reduce overall portfolio risk.
Fidelity’s investment team actively manages their fixed income portfolio to take advantage of market opportunities and minimize losses. They use a combination of active management and index tracking to optimize returns, while also ensuring that the portfolio remains aligned with their investment objectives.
What is Fidelity’s approach to alternative investments?
Fidelity’s approach to alternative investments is designed to provide additional diversification and returns to their portfolio. They invest in a range of alternative assets, including real estate, commodities, and private equity, to reduce dependence on traditional assets and increase returns.
Fidelity’s investment team carefully selects alternative investments that they believe have the potential to generate strong returns and provide diversification benefits. They use a combination of internal research and external expertise to identify opportunities and manage risk, while also ensuring that alternative investments align with their overall investment objectives.
How does Fidelity approach socially responsible investing?
Fidelity’s approach to socially responsible investing (SRI) is centered around aligning investments with their clients’ values and beliefs. They offer a range of SRI funds and portfolios that invest in companies that demonstrate strong environmental, social, and governance (ESG) practices.
Fidelity’s investment team uses a combination of internal research and external expertise to identify companies that meet their ESG criteria. They also engage with companies to promote better ESG practices and encourage sustainable investing. By investing in SRI funds, investors can align their values with their investments and support companies that are making a positive impact.
How often does Fidelity rebalance their portfolio?
Fidelity regularly rebalances their portfolio to ensure that it remains aligned with their investment objectives and risk tolerance. The frequency of rebalancing depends on market conditions and the specific portfolio, but it is typically done on a quarterly or annual basis.
Fidelity’s investment team uses a combination of quantitative and qualitative analysis to determine when rebalancing is necessary. They monitor portfolio performance and market trends to identify deviations from target allocations and make adjustments as needed to ensure that the portfolio remains on track to meet its objectives.
How transparent is Fidelity about their investment holdings?
Fidelity is committed to providing transparency about their investment holdings. They provide regular portfolio updates and disclosures to their clients, including information on their investment holdings, asset allocation, and performance.
Fidelity also provides detailed information on their investment process and philosophy, as well as the expertise and experience of their investment team. By being transparent about their investment holdings and process, Fidelity aims to build trust and confidence with their clients and help them make informed investment decisions.