Fidelity U.S. High Quality 

This passively managed exchange-traded fund (ETF) is designed to give investors access to high-quality U.S. large and mid-capitalization stocks. It utilizes a smart beta, rules-based proprietary index methodology specifically crafted to target strategic investment factors. The initial selection universe comprises the 1,000 largest American equities. From this, stocks are rigorously screened using a composite factor score, which considers metrics such as free cash flow margin, return on invested capital, and the stability of free cash flow. For banking entities, this calculation is exclusively based on return on equity and debt-to-asset ratios. To ensure impartiality regarding company size, the composite score is blended with a size factor. Within each sector, individual securities are then chosen based on their size-adjusted composite score. The portfolio typically holds between 60 and 100 stocks, with sectors exhibiting a higher return on invested capital being allocated a greater weighting. The index is subject to rebalancing on a semi-annual basis.