Fidelity's New ETFs Aim At Mid, Small Caps As Active Funds Take Off

Fidelity Investments is expanding its push into active, factor-driven strategies with the launch of four new ETFs. The funds extend Fidelity's "Enhanced ETF" suite to 12 products, targeting growth and value opportunities across mid- and small-cap equities. The funds are:

• Fidelity Enhanced Mid Cap Growth ETF (NYSE:FEMG),
• Fidelity Enhanced Mid Cap Value ETF (NYSE:FEMV),
• Fidelity Enhanced Small Cap Growth ETF (NYSE:FSEG), and
• Fidelity Enhanced Small Cap Value ETF (NYSE:FSEV)

The new ETFs follow a quantitative, actively managed approach that blends traditional fundamentals with non-traditional data inputs to identify stocks with favorable characteristics while managing risk exposures. Fidelity executives say the expansion reflects rising demand for low-cost, rules-based active solutions.

Key features:

• Active + systematic approach: Combines proprietary quantitative models with fundamental and alternative data signals
• Market coverage: Targets both growth and value styles within mid-cap and small-cap segments
• Team-based management: Led by co-managers Anna Lester, George Liu, and Shashi Naik, supported by a deep bench of quantitative researchers
• Competitive pricing: Expense ratios set at 0.23% for the mid-cap ETFs and 0.28% for the small-cap ETFs
• Advisor-friendly structure: Designed for tax efficiency, flexibility, and precision within diversified portfolios
• Built on scale: Part of a larger enhanced ETF lineup backed by over 250 quants, data scientists, and technologists

The launch comes as asset managers double down on systematic active strategies packaged in ETF wrappers—an area seeing growing traction among advisors and retail investors alike.

Data from Fidelity's portfolio construction team underscores the trend: active ETF allocations have climbed sharply, with 38% of incoming portfolios in Q1 2026 holding such funds, up from just 13% in 2022. Fidelity's broader ETF and ETP platform now spans 81 products with $149 billion in assets under management as of March-end.

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