Best ETFs
Schwab and Vanguard charge the same 0.03%. Their small-cap funds are 3.7 percentage points apart
Fidelity Enhanced Small Cap ETF
$45.15−0.09 (−0.20%)
- 0.28%
- $6.4B
- +28.6%
- 0.87%
- 0.9M sh
- $45.22
- low $34.83high $48.93
The ETF.net FESM Grade
A
Score 86 out of 100
- 2 of 41
Score 86 of 100 falls in the A band. A is 70 or higher, B 55 to under 70, C 40 to under 55, D 25 to under 40, F under 25.
Cost
The fund’s net expense ratio, ranked against its category.A96 out of 100Rank 2 of 41Mission
Whether the fund did what it promised, tested against its stated mandate.A85 out of 100Rank 3 of 10Risk
How the fund held up when markets fell: downside volatility, drawdowns and tail loss.B61 out of 100Rank 11 of 38Tradability
How easy the fund is to trade: daily volume, and how far its price strays from net asset value.A92 out of 100Rank 2 of 41Holdings
How concentrated the fund is, and how complete and current its disclosed holdings are.A81 out of 100Rank 5 of 41Durability
Whether the fund is likely to stay open, judged by its age, its assets and its issuer’s assets.A93 out of 100Rank 2 of 41
Our read on FESM
AA quant small-cap strategy that has been running since 2007 and moved into an ETF wrapper in 2023 with the same mandate. It nudges the Russell 2000 rather than copying it, and charges far less than the typical active small-cap fund.
The fund is a diversified U.S. equity strategy focused on small-cap companies. It seeks to outperform its benchmark through a quantitative process that balances risk and return.
Why people hold it
- Costs 0.28% a year, roughly half the median for active US small-cap ETFs. Cheap fuel for a strategy that only needs to beat its benchmark by a little.
- The strategy dates to 2007 as a Fidelity mutual fund and kept the same objective when it converted to an ETF in 2023. Long history, newer ticker.fidelity.com
- A multi-billion-dollar fund that trades actively, so getting in and out tends to be straightforward. One of the stronger builds in the active small-cap group.
- Spreads across roughly 600 small-cap names, so no single blowup dominates. This is a diversified core sleeve, not a concentrated stock-picker bet.
Worth knowing
- Small caps are the choppiest corner of the US market, and this fund lives there full time. Expect a bumpier ride than a large-cap core holding.institutional.fidelity.com
- Enhanced index means small tilts around the Russell 2000, not a break from it. Results track close to the index rather than looking dramatically different.institutional.fidelity.com
- Cheap, but not the cheapest in the room: top-rated peers AVSC and AVUV run 0.25% and DUHP 0.20%.
FESM Holdings
- Stocks
- 900
- 10%
- Securities Lending Cf
Sectors
- Health Care22.0%
- Technology18.8%
- Financials16.8%
- Industrials14.0%
- Consumer Discretionary8.4%
- Energy5.7%
- Real Estate4.4%
- Materials3.7%
- Communication3.1%
- Utilities1.7%
- Consumer Staples1.3%
Geography
- United States96.34%
- Bermuda1.50%
- Ireland0.55%
- Puerto Rico0.41%
- Canada0.30%
- Switzerland0.30%
- Cayman Islands0.23%
- Brazil0.12%
- 0.23%
FESM Performance
Shows how $10,000 changes over the selected period, with cash distributions reinvested at the closing price on each ex-dividend date.
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FESM$12,863
Returns run to the Oct 12, 2026 close, with cash distributions reinvested. Each period starts on the same date that many months or years earlier. Periods over one year show the average yearly return.
| Period | FESM |
|---|---|
| Year to date | +20.6% |
| 1 month | −2.2% |
| 3 months | −4.6% |
| 1 year | +28.6% |
| 3 years | — |
| 5 years | — |
| 10 years | — |
Calendar-year total return with cash distributions hypothetically reinvested at the ex-dividend date’s closing price. The current year shows year to date.
| Year | Return bar | FESM |
|---|---|---|
| 2026 YTD | +20.6% | |
| 2025 | +17.9% | |
| 2024 | +16.2% | |
| 2023 | +12.2% |
FESM in the news
FESM Dividends
- 0.87%
- $0.39
- $0.10 per share
- Quarterly
Distribution history
FESM Risk
- 19.9%
How it’s calculated: standard deviation
The sample standard deviation of monthly total returns, multiplied by the square root of 12.
Uses up to 36 complete months, with at least 12 required. Total returns include reinvested distributions.
- 0.97
How it’s calculated: Sharpe ratio
Subtract each month’s Treasury-bill return from the fund’s monthly total return.
Divide the average of those excess returns by their sample standard deviation, then multiply by the square root of 12.
Uses up to 36 complete months, with at least 12 required. Each month uses the Treasury yield quoted at the end of the previous month.
- −26.9%
How it’s calculated: maximum drawdown
The largest percentage decline from an earlier peak, using total returns with reinvested distributions.
Uses up to five years through the last close, with at least 12 months required.
- 1.34
How it’s calculated: beta
The beta figure is supplied by FMP. The comparison index depends on the fund’s broad asset class.
FESM Cost
0.28%
FESM0.28%
- The middle half of US Active Small-Cap funds
- Median 0.55%
1 of the 39 US Active Small-Cap funds charge less.
Other funds in US Active Small-Cap
- AAVSCAvantis U.S. Small Cap Equity ETFExpense ratio 0.25%1 year return +28.0%
- ADFSVU.S. Small Cap Value Portfolio ETF Class SharesExpense ratio 0.33%1 year return +26.2%
- ADUSGU.S. Small Cap Growth Portfolio: ETF Class SharesExpense ratio 0.33%1 year return —
- ARESMColumbia Research Enhanced Small Cap ETFExpense ratio 0.32%1 year return —
- BJSMLJanus Henderson Small Cap Growth Alpha ETFExpense ratio 0.30%1 year return +21.2%