Fidelity^® Fundamental Developed International ETF (FFDI): Investment Approach

• Fidelity^® Fundamental Developed International ETF is a diversified international equity strategy that is designed to provide style-box consistent exposure while offering risk-adjusted return potential in a core portfolio holding.
• Fidelity's Fundamental ETF suite seeks to leverage the bottom-up, fundamental views of some of our best active managers, via a quantitative process to capture portfolio manager conviction and alpha opportunities.
• The ETFs employ an investment process that starts with identifying source portfolio managers which encompass the views of Fidelity's fundamental research and portfolio manager conviction.
• In contrast to most fund-of-funds, in which multiple portfolios are simply aggregated, our approach incorporates a proprietary quantitative process to identify and measure the highest-conviction holdings from each source manager.
• Portfolio construction then emphasizes the highest-conviction ideas, while ensuring exposure consistent with the appropriate Morningstar Style Box, subject to security and risk constraints.