FTEC vs. FESM

Last updated Jun 12, 2026

FTEC (Fidelity MSCI Information Technology Index ETF) and FESM (Fidelity Enhanced Small Cap ETF) are both exchange-traded funds - FTEC is a Technology Equities fund tracking the MSCI USA IMI Information Technology 25/50 Index, while FESM is a Small Cap Blend Equities fund actively managed by Fidelity. FTEC is passively managed, while FESM is actively managed. Over the past year, FTEC returned 48.82% vs 46.94% for FESM. A 0.67 correlation means they provide meaningful diversification when combined. FTEC charges 0.08%/yr vs 0.28%/yr for FESM.

Performance

FTEC vs. FESM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Fidelity MSCI Information Technology Index ETF (FTEC) and Fidelity Enhanced Small Cap ETF (FESM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, FTEC achieves a 23.52% return, which is significantly higher than FESM's 21.71% return.

FTEC

• 1D: 3.28%
• 1M: 3.46%
• YTD: 23.52%
• 6M: 20.02%
• 1Y: 48.82%
• 3Y*: 30.35%
• 5Y*: 20.48%
• 10Y*: 24.91%

FESM

• 1D: 2.99%
• 1M: 3.87%
• YTD: 21.71%
• 6M: 17.35%
• 1Y: 46.94%
• 3Y*: —
• 5Y*: —
• 10Y*: —

*Multi-year figures are annualized to reflect compound growth (CAGR)

FTEC vs. FESM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023
FTEC Fidelity MSCI Information Technology Index ETF	23.52%	22.11%	29.40%	6.33%
FESM Fidelity Enhanced Small Cap ETF	21.71%	17.88%	16.22%	12.09%

Correlation

The correlation between FTEC and FESM is 0.68, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.68
Correlation (All Time) Calculated using the full available price history since Nov 20, 2023	0.67

The correlation between FTEC and FESM has been stable across timeframes, ranging from 0.67 to 0.68 - a consistent structural relationship.

FTEC vs. FESM - Sectors Allocation Comparison

Sectors	FTEC	FESM
Technology	98.5%	21.6%
Communication Services	0.5%	3.1%
Financial Services	0.5%	14.8%
Industrials	0.4%	19.1%
Energy	0.4%	7.2%
Consumer Cyclical	0.1%	7.4%
Basic Materials	-	3.5%
Consumer Defensive	-	1.4%
Healthcare	-	15.7%
Real Estate	-	4.2%
Utilities	-	2.0%

Return for Risk

FTEC vs. FESM — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

FTEC

FTEC Risk / Return Rank: 74
FTEC Sharpe Ratio Rank: 83
FTEC Sortino Ratio Rank: 76
FTEC Omega Ratio Rank: 76
FTEC Calmar Ratio Rank: 72
FTEC Martin Ratio Rank: 64

FESM

FESM Risk / Return Rank: 87
FESM Sharpe Ratio Rank: 88
FESM Sortino Ratio Rank: 86
FESM Omega Ratio Rank: 80
FESM Calmar Ratio Rank: 90
FESM Martin Ratio Rank: 89

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

FTEC vs. FESM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Fidelity MSCI Information Technology Index ETF (FTEC) and Fidelity Enhanced Small Cap ETF (FESM). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	FTEC	FESM	Difference
Sharpe ratio: Return per unit of total volatility	2.22	2.42	-0.20
Sortino ratio: Return per unit of downside risk	2.77	3.25	-0.48
Omega ratio: Gain probability vs. loss probability	1.37	1.40	-0.03
Calmar ratio: Return relative to maximum drawdown	3.02	4.63	-1.61
Martin ratio: Return relative to average drawdown	9.43	16.65	-7.22

FTEC vs. FESM - Sharpe Ratio Comparison

The current FTEC Sharpe Ratio is 2.22, which is comparable to the FESM Sharpe Ratio of 2.42. The chart below compares the historical Sharpe Ratios of FTEC and FESM, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

FTEC vs. FESM - Drawdown Comparison

The maximum FTEC drawdown since its inception was -34.95%, which is greater than FESM's maximum drawdown of -26.93%. Use the drawdown chart below to compare losses from any high point for FTEC and FESM.

Drawdown Indicators

	FTEC	FESM	Difference
Max Drawdown Largest peak-to-trough decline	-34.95%	-26.93%	-8.02%
Max Drawdown (1Y) Largest decline over 1 year	-16.26%	-10.18%	-6.08%
Max Drawdown (3Y) Largest decline over 3 years	-27.30%	—	—
Max Drawdown (5Y) Largest decline over 5 years	-34.95%	—	—
Max Drawdown (10Y) Largest decline over 10 years	-34.95%	—	—
Current Drawdown Current decline from peak	-7.75%	0.00%	-7.75%
Average Drawdown Average peak-to-trough decline	-5.57%	-4.76%	-0.81%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.19%	2.83%	+2.36%

Volatility

FTEC vs. FESM - Volatility Comparison

Fidelity MSCI Information Technology Index ETF (FTEC) has a higher volatility of 10.05% compared to Fidelity Enhanced Small Cap ETF (FESM) at 6.76%. This indicates that FTEC's price experiences larger fluctuations and is considered to be riskier than FESM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	FTEC	FESM	Difference
Volatility (1M) Calculated over the trailing 1-month period	10.05%	6.76%	+3.29%
Volatility (6M) Calculated over the trailing 6-month period	18.06%	14.08%	+3.98%
Volatility (1Y) Calculated over the trailing 1-year period	22.07%	19.49%	+2.58%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	25.46%	21.36%	+4.10%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.81%	21.36%	+3.45%

FTEC vs. FESM - Expense Ratio Comparison

FTEC has a 0.08% expense ratio, which is lower than FESM's 0.28% expense ratio.

Dividends

FTEC vs. FESM - Dividend Comparison

FTEC's dividend yield for the trailing twelve months is around 0.34%, less than FESM's 0.53% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FESM Fidelity Enhanced Small Cap ETF	0.53%	0.82%	1.08%	0.06%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
FTEC Fidelity MSCI Information Technology Index ETF	0.34%	0.43%	0.49%	0.77%	0.93%	0.63%	0.83%	1.03%	1.20%	0.96%	1.25%	1.27%

Frequently Asked Questions

Can I hold both FTEC and FESM in my portfolio?

FTEC and FESM have a correlation of 0.68, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, FTEC or FESM?

FTEC has higher volatility (10.05%) compared to FESM (6.76%). In terms of maximum drawdown, FTEC dropped -34.95% vs FESM's -26.93%.

Which ETF is better, FTEC or FESM?

On 1-year performance, FTEC leads with 48.82% vs 46.94% for FESM. On fees, FTEC is cheaper at 0.08% per year. On volatility, FESM has been the lower-risk option at 6.76%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, FTEC or FESM?

Over the 1-year period, FTEC has performed better with a 48.82% return vs 46.94%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, FTEC or FESM?

FTEC is cheaper with a 0.08% expense ratio, compared with 0.28% for FESM.

Which ETF pays a higher dividend yield, FTEC or FESM?

FESM has the higher dividend yield at 0.53%, compared with 0.34% for FTEC.

What is the main difference between FTEC and FESM?

FTEC is categorized as Technology Equities, while FESM is Small Cap Blend Equities. Their fees differ too: 0.08% for FTEC and 0.28% for FESM.

Which has better risk-adjusted returns?

FESM currently has the higher Sharpe Ratio (2.42 vs 2.22), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.