Fidelity launches three ETF share classes, allows conversions

Fidelity launched three ETF share classes on June 18, 2026 and enabled investors to convert certain mutual fund shares directly into the new ETF share classes.

The new tickers are the Fidelity Intermediate Municipal Income ETF (FIMU), the Fidelity Real Estate Income ETF (FREI) and the Fidelity Short-Term Bond ETF (FSTB). Each ticker represents an ETF share class of an existing mutual fund and retains the same portfolio managers and investment strategies.

All three share classes cover fixed-income strategies. FIMU and FREI focus on income generation while FSTB targets shorter-duration bonds. The ETF share classes will trade on exchanges in an ETF wrapper while following the underlying mutual fund strategies.

Fidelity cited recent exemptive relief that permits mutual funds to add ETF share classes. The firm, which manages $17.9 trillion in assets under administration, is the fifth asset manager to offer ETF share classes for mutual funds.

Investors in the affected mutual funds can convert their mutual fund shares directly into the corresponding ETF shares rather than selling their holdings and repurchasing on an exchange. Fidelity described the conversion option as a way to provide direct access to the ETF share classes for existing shareholders.

Greg Friedman, head of ETFs at Fidelity Investments, wrote in a press release: “We are at an inflection point in the ETF industry, with exemptive relief providing the opportunity to offer additional product choice for investors. Fidelity remains committed to delivering innovation and exceptional value to our customers, and the long-term historical performance of these strategies paired with the experienced portfolio management teams make them a strong fit to adopt Fidelity’s first ETF share classes.”

Todd Rosenbluth, head of research at VettaFi, wrote that the rollout has been gradual and deliberate and that ETF share classes were expected to allow substantial mutual fund assets to flow into the exchange-traded ecosystem.

ETF share classes can produce different tax and trading outcomes than mutual funds. ETFs trade intraday on exchanges and commonly use in-kind creation and redemption mechanisms that can limit taxable capital gains in some cases. Fidelity said the ETF share classes combine the ETF wrapper with access to the firms’ established strategies.

The initial launch covers three fixed-income strategies. Market participants will watch for additional ETF share-class conversions across Fidelity’s fund lineup.