As 2025 draws to a close, investors are eyeing potential stock market leaders for the upcoming year. While equities have largely been driven by a select few technology stocks, there are signs that broader market themes might be emerging. Fidelity, known for its extensive portfolio of over 50 equity ETFs, is positioning itself to capitalize on these shifts, particularly with three standout options.
The Fidelity Quality Factor ETF (FQAL) focuses on high-quality stocks, emphasizing companies with strong cash flow margins, stability, and solid returns on invested capital. This ETF primarily invests in the largest 1,000 U.S. stocks, which includes major players like Nvidia, Apple, Microsoft, Alphabet, and Broadcom. As the market potentially shifts away from tech dominance, FQAL’s strategy could provide a robust balance by identifying financially healthy companies. This dual focus may appeal to those who believe in continued tech growth as well as those cautious of an economic slowdown.
Similarly, the Fidelity High Dividend ETF (FDVV) emerged as a top performer in 2025, leveraging strong tech holdings while still prioritizing dividends. The ETF is built upon the largest 1,000 stocks globally, assessing them through three key criteria: dividend yield, growth rate, and payout ratio. Although the name suggests a straightforward high-yield strategy, FDVV balances its sector allocations based on yield while still weighting individual holdings by market value. With major tech companies like Nvidia and Apple among its top holdings, FDVV can benefit from continuing momentum in the tech sector while still providing exposure to higher-yielding cyclicals and defensive sectors.
On the international front, the Fidelity Emerging Markets Multifactor ETF (FDEM) positions investors to take advantage of anticipated growth in emerging markets. While international stocks have shown strength, FDEM sets itself apart by screening for favorable valuations, quality, momentum, and low volatility, effectively filtering out weaker companies from the investment pool. The International Monetary Fund projects that emerging markets will outpace the U.S. economy, growing at an estimated 4%. Currently, FDEM’s price/earnings ratio stands at 13, highlighting a significant discount compared to the S&P 500, which could present an attractive opportunity as the dollar weakens.
In conclusion, as the market landscape evolves, these three Fidelity ETFs offer diverse strategies that cater to different investment philosophies, aiming to capture potential growth across quality, dividends, and emerging markets. Investors looking for robust options may find these ETFs align well with their portfolio objectives heading into 2026.
