Fidelity Fixed Income ETFs

Fidelity Fixed Income ETFs

August 11th, 2022

Montanna Saltsman Investment Product Manager

Celso Mu?oz, CFA Portfolio Manager

Benjamin Harrison, CFA Portfolio Manager

All information as of 7/31/22 unless otherwise noted. ? 2022 FMR LLC. All rights reserved.

Agenda

1. Fixed Income ETF Overview

? Montanna Saltsman, Investment Product Manager

2. Fixed Income Market Perspectives

? Celso Mu?oz, CFA, Portfolio Manager ? Fidelity Total Bond ETF (FBND) ? Fidelity Sustainable Core Plus Bond ETF (FSBD)

3. High Yield Market Perspectives

? Ben Harrison, CFA, Portfolio Manager ? Fidelity Sustainable High Yield ETF (FSYD)

2

Fixed Income ETF Overview

Montanna Saltsman Investment Product Manager

Current State of Fixed Income ETFs

542 ETFs with $70 billion in net flows YTD

YTD FLOWS BY CATEGORY

Equity Fixed Income Commodity Other 1%

5% 24%

70%

FIXED INCOME ETF AUM 21% CAGR since 2010

$1,278 $1,257

$1,095

$854

$640 $564

$134

$177

$238

$235

$289

$340

$433

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Q2 '22

4 Source: Bloomberg, as of 06/30/2022

Best Practices When Trading ETFs

ORDER TYPE

Understanding the difference in various order types can impact execution price e.g., limit orders instead of market orders to prevent order being executed at an unwanted price

ASSET CLASS

Understand the market the ETF represents ? Different asset classes will have different liquidity characteristics

TIME OF DAY

The first and last 15-20 minutes of the trading day can be more volatile which may impact trading decisions and pricing quality

ORDER FLOW

Understanding your platform's order flow and execution framework can help achieve best execution

TRADING SUPPORT

Utilize trading counterparties or ETF sponsors to help gauge the indicative costs to implement your trade

5 Source: Fidelity Investments.

What We Offer--51 ETFs

Fidelity Active Equity ETFs1 (9)

Actively-managed ETFs offering the potential for outperformance in large

cap equity ETFs2

Fidelity Fixed Income ETFs (11)

ETFs to help navigate the bond market

Fidelity Equity Factor ETFs (13)

Precise exposure to factor-based strategies

Fidelity Thematic ETFs (6)

ETFs that may align with your interests or objectives

Fidelity Sector ETFs (11)

Targeted sector exposure for your portfolios

Fidelity Broad Equity ETF (1)

Exposure to the NASDAQ Composite Index (ONEQ)

1 Fidelity Active Equity ETFs are different from traditional ETFs. Traditional ETFs tell the public what assets they hold each day. These ETFs will not. This may create additional risks for your investment. For example, you may have to pay more money to trade the shares of these ETFs. These ETFs will provide less information to traders, who tend to charge more for trades when they have less information; the price you pay to buy ETF shares on an exchange may not match the value of each ETF's portfolio. The same is true when you sell shares. These price differences may be greater for these ETFs compared to other ETFs because they provide less information to traders; these additional risks may be even greater in bad or uncertain market conditions; each ETF will publish on and i. a "Tracking Basket" designed to help trading in shares of the ETF. While the Tracking Basket includes some of the ETF's holdings, it is not the ETF's actual portfolio. The differences between these ETFs and other ETFs may also have some advantages. By keeping certain information about the ETFs secret, they may face less risk that other traders can predict or copy their investment strategy. This may improve the ETFs' performance. However, if the investment strategy can be predicted or copied, this may hurt the ETFs' performance.

Because of their narrow focus, sector investments tend to be more volatile than investments that diversify across many sectors and companies. For additional information regarding the unique attributes and risks of these ETFs, see the Important Information section in the appendix.

6 2 While Active ETFs offer the potential to outperform an index, these products may more significantly trail an index as compared with passive ETFs.

Fidelity Active Fixed Income ETFs

Leveraging Fidelity's extensive investment capabilities and expertise

FLTB Fidelity Limited Term Bond ETF

Investment Strategy Rationale

An actively managed ETF for income-seeking investors who are concerned about interest rate risk.

Invests primarily in investment-grade bonds maturing in one to five years. The ETF's focus on shorter-maturity bonds helps keep its interest rate sensitivity low while providing income potential.

FIGB Fidelity Investment Grade Bond ETF

Investment Strategy Rationale

An actively managed, core fixed income ETF for investors seeking one-stop access to a diverse group of U.S. high-grade bond sectors.

Seeks income from a broad selection of fixed income securities, with a core exposure in investment-grade bonds.

FSEC

Fidelity Investment Grade Securitized ETF

Investment Strategy Rationale

An actively managed, core fixed income ETF for investors seeking income and diversification from high-quality securitized products.

Seeks income by investing primarily in agency mortgage-backed securities, and in a variety of other securitized products, including nonagency MBS, non-agency CMBS, and ABS.

FCOR

Fidelity Corporate Bond ETF

Investment Strategy Rationale

An actively managed fixed income ETF for investors seeking income and diversification from high-quality corporate bonds.

Seeks income by investing primarily in investment-grade corporate bonds and may offer lower volatility than investing in high-yield bonds and emerging-market debt.

FBND Fidelity Total Bond ETF

Investment Strategy Rationale An actively managed, core fixed income ETF for investors seeking income and a measure of protection from stock market volatility.

Seeks income from a broad selection of fixed income securities, with a core exposure in investment-grade bonds. This diverse allocation may help the ETF add value in a variety of markets.

FDHY

Fidelity High Yield Factor ETF

Factor Rationale

Spread premium measures value based on a bond's option-adjusted spread (OAS) minus its fair value spread (i.e., fair value based on probability of default)

Spread ratio measures OAS multiple over fair value spread

Weight 50% 50%

Active management structure provides flexibility to work with new issues, substitute bonds within the same issuer, and avoid illiquid names and unnecessary turnover

FPFD

Fidelity Preferred Securities & Income ETF

Investment Strategy Rationale

An actively managed ETF for risk-tolerant investors seeking high total return through a combination of current income and capital appreciation.

Seeks income by investing primarily in preferred securities, which may provide income and equity diversification with low correlation to bonds and lower volatility than common stocks. Preferred securities offer attractive yields versus investmentgrade bonds or common stocks with steady total performance.

There is no guarantee that a factor-based investing strategy will enhance performance or reduce risk. Before investing, make sure you understand how the fund's factor investment strategy may differ from more traditional index products. Depending on market conditions, fund performance may under perform compared to products that seek to track a more traditional index. Diversification does not ensure a profit or guarantee against a loss.

7 Please see Important Information slides for additional information, including investment risks.

Fidelity Active Fixed Income Sustainable ETFs

A sustainability focused lineup of bond ETFs

FSLD

Fidelity Sustainable Low Duration Bond ETF

Investment Strategy Rationale

A low duration bond ETF for investors seeking exposure to shorter maturity investment-grade debt securities believed to have positive ESG benefits.

FSBD

Fidelity Sustainable Core Plus Bond ETF

Investment Strategy Rationale

A core fixed income ETF that provides exposure to debt securities of all types believed to have positive ESG benefits.

FSYD

Fidelity Sustainable High Yield ETF

Investment Strategy Rationale

A core high yield bond ETF that invests in issuers with proven or improving sustainability practices based on an evaluation of their individual ESG profile.

While environmental, social and corporate governance (ESG) factors are available to incorporate into our investment process across all Fidelity strategy offerings, ESG assessments represent one of many pieces of research available to the portfolio managers and the degree to which it impacts a strategy's holdings may vary strategy by strategy based on the portfolio manager's discretion. Investing based on ESG factors may cause a strategy to forgo certain investment opportunities available to strategies that do not use such criteria. Because of the subjective nature of sustainable investing, there can be no guarantee that ESG criteria used by Fidelity will reflect the beliefs or values of any particular client. Diversification does not ensure a profit or guarantee against a loss.

8 Please see Important Information slides for additional information, including investment risks.

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