Investing in dividend-paying stocks is one way to make your money work for you. As companies grow, they generate a higher profit and share a part of the profit with the shareholders as a cash dividend. However, stocks do carry risk, and there’s no guarantee that a company will pay a dividend. Hence, if you’re looking for a low-risk, low-cost way to make your money work for you, consider investing in exchange-traded funds (ETFs).
There are hundreds of ETFs to choose from, but if you’re looking for top-quality ETFs that can beat the S&P 500, consider investing in Fidelity ETFs. It has a strong history and a solid reputation and offers a diverse range of ETFs to invest in. Here are the three I’d pick.
Fidelity Blue Chip Growth ETF
An actively managed fund, Fidelity Blue Chip Growth ETF (FBCG) invests in large-cap, high-growth companies. These are established companies with a stable balance sheet. The fund aims to generate high returns by investing in the top U.S. blue-chip stocks. It holds 373 stocks and has an expense ratio of 0.61%.
FBCG has the highest investment in the information technology sector at 48% and holds the biggest tech giants in the top 10. These include Nvidia, Microsoft Corporation, Netflix, Meta Platforms, Apple, and Alphabet. The top 10 stocks form 61% of the portfolio. The tech industry is rallying, and this is why FBCG has managed to generate impressive returns.
As long as the tech sector continues to grow, the ETF will keep rising. It has generated an average annual return of 17.17% in a year and 32.19% in 3 years. Besides tech, it invests 16.25% in the consumer discretionary segment and 15.73% in the communication services industry.
FBCG is one of the best options if you’re looking for long-term growth and aren’t worried about the tech-heavy portfolio. While its expense ratio is on the higher end of the spectrum, it offers the best stocks you can own in the S&P 500. The fund has gained 16.54% in the past year and is exchanging hands for $54.53. I believe the rally will continue throughout 2026, and it could generate higher returns than the S&P 500.
Fidelity MSCI Information Technology Index ETF
Another excellent ETF by Fidelity, the Fidelity MSCI Information Technology Index ETF (NYSEARCA:FTEC) tracks the MSCI USA IMI Information Technology 25/50 index. It invests in the top IT names you’d be familiar with.
The fund holds 291 stocks with complete allocation to the information technology sector. This means you’re making the most of the tech upside. Its top 10 holdings constitute 58% of the portfolio and include Nvidia, Apple, Broadcom, Palantir, Advanced Micro Devices, Oracle, and more. With FTEC, you do not need to buy any tech stocks individually.
You can get exposure to legacy businesses with just one investment. The fund has the highest allocation to the semiconductor sector (36%), followed by software (31%) and hardware, storage, and peripherals (17%).
FTEC has not only beaten the S&P 500 but has also crushed it. The fund gained 23% in the past year and is exchanging hands for $222.96. It has generated over 100% returns in five years. That said, the fund has a dividend yield of 0.38%, which may not be huge, but it can grow your total return. It has an expense ratio of 0.084%.
FTEC has generated an average annual return of 22.09% in a year and 34.31% in 3 years. It has a beta of 1.28, which is slightly more volatile than the S&P 500, which has a beta of 1. Given the current market situation where tech stocks are rallying, FTEC is a smart investment choice.
Fidelity International High Dividend ETF
When it comes to building a portfolio that survives the market ups and downs, it is important to consider geographical diversification. In the long term, it will help make the most of the global economic growth. While U.S. equities have outperformed their global counterparts, the long-term picture could be different. This is where Fidelity International High Dividend ETF (FIDI) comes into play. It is a great option to achieve ultimate diversification.
The fund invests in 115 global stocks and chooses companies with a high dividend yield. It tracks the performance of the Fidelity International High Dividend IndexSM. The fund invests in large – and mid-cap companies with high dividend yields and the ability to grow the dividends. It has a yield of 4.34% and an expense ratio of 0.19%.
The ETF has the highest allocation to the financial services sector at 34%, followed by consumer defensive at 13.67% and basic materials at 13.4%. Its top 10 holdings constitute 25.5% of the portfolio and include Enel SpA, Nestlé, Rio Tinto, Brookfield Renewable, British American Tobacco, and National Grid plc.
It has gained 35% in the past year and is exchanging hands for $27.15. The fund has generated a 1-year average annual return of 38.70% and a 3-year return of 17.50%.
If you’re a passive income investor, FIDI will not disappoint.