In a “if you can’t beat ’em, poach ’em” moment, mutual fund monster Fidelity Investments has apparently thrown in the towel and will finally focus on running their own actively-managed sector-specific ETFs. At least that’s the obvious conclusion being drawn by industry watchers after news of Fidelity, which still only offers one house-branded ETF, announced the hiring of former employee Tony Rochte, who left Fidelity after four years in 2000 to seek his fortunes in the wild west days of ETF pioneering.
The widely-respected Rochte spent his next six years at BlackRock’s bootcamp carrying the iShares flag, and the most recent six years as Senior MD over at State Street Global, where he helped the second largest ETF issuer become, well, the second largest ETF issuer.
According to InvestmentNews:With Mr. Rochte’s background in ETFs and his new role running a division focused on sector investments, it seems like a no-brainer to some that Fidelity would re-launch those strategies as active ETFs.
“It would be a logical next step,” said Robert Goldsborough, an ETF analyst at Morningstar Inc. “Given that the sector funds already exist and they’re popular with advisers, it would make a tremendous amount of sense to move that competency over to ETFs.” Duh!