FDMO ETF Price Forecast - FDMO High-Octane Momentum At $85.95 After Doubling In Three Years

NYSEARCA:FDMO – Fidelity Momentum Factor ETF Price, Structure And 2026 Call

Current NYSEARCA:FDMO price zone, trading range and yield

Fidelity Momentum Factor ETF (NYSEARCA:FDMO) closed at $85.95 on January 30, down 1.74% from the previous close of $87.11, after trading between $85.85 and $87.35 during the session. The fund is hovering just below its 52-week high of $88.09, far above the 52-week low of $55.89, which locks in a very strong 12-month run. Assets under management are about $640 million, class AUM around $608 million, average daily volume is roughly 2.97K shares, and the expense ratio is 0.15%. The trailing dividend yield is approximately 0.60% on a $0.51 annual distribution, paid quarterly, which confirms FDMO ETF is designed as a price-return momentum vehicle, not a yield product.

How the NYSEARCA:FDMO ETF builds its momentum factor exposure

FDMO ETF tracks the Fidelity U.S. Momentum Factor Index, targeting large- and mid-cap U.S. stocks with strong momentum and supportive sentiment. The index uses a composite score built from four hard inputs: total return over a defined lookback window, volatility-adjusted return, frequency and size of positive earnings surprises, and average short interest where lower shorting is treated as a positive sentiment signal. Two metrics are purely price-driven, two are sentiment-linked through earnings and positioning. The methodology is sector-neutral versus the parent universe, so each sector in FDMO keeps roughly the same weight as in a broad index like the Russell 1000 but only the highest-scoring names in that sector are selected, then weighted by market cap. Rebalancing is frequent and aggressive, reflected in a turnover rate of about 121% in the last fiscal year, which shows that losers are removed and new momentum leaders rotated in quickly rather than left to drift.

Portfolio structure and sector concentration inside NYSEARCA:FDMO

The FDMO ETF portfolio holds roughly 127–130 stocks, with about 73% of exposure in large and mega-caps and a clear growth tilt. Sector exposure is dominated by technology at around 33.3%, while communication services and consumer cyclical stocks together carry about 20% of the weight. Because the strategy is sector-neutral but cap-weighted inside each sector, the outcome is a concentrated momentum portfolio sitting on top of the current leadership complex rather than an equal-weight spread across hundreds of names. The top ten holdings account for roughly 38.3% of assets, led by NVIDIA (NVDA) at 8.21%, Microsoft (MSFT) at 6.68%, Alphabet Class A (GOOGL) at 5.54%, Amazon (AMZN) at 3.95%, Broadcom (AVGO) at 3.56%, Meta Platforms (META) at 2.59%, Tesla (TSLA) at 2.42%, Berkshire Hathaway B (BRK.B) at 1.86%, JPMorgan (JPM) at 1.80%, and Micron (MU) at 1.71%. Additional high-momentum positions such as Lam Research, Palantir, Amphenol, Seagate, Visa, Oracle, Gilead and Mastercard extend exposure to semiconductors, financial infrastructure and high-cash-flow compounders. This makes FDMO effectively a leveraged play on the Magnificent 7 plus second-tier AI and growth winners, with sector diversification mainly used to control risk rather than dilute the momentum bet.

Valuation and growth profile of the FDMO ETF versus broad U.S. equity

On fundamentals, NYSEARCA:FDMO trades at a clear premium to a broad large-cap benchmark. The trailing price-to-earnings ratio is about 31.0 versus roughly 27.1 for the Russell 1000, price-to-book is 6.46 versus 4.81, price-to-sales is 4.38 versus 3.30, and price-to-cash-flow is 23.43 versus 19.14. In exchange for that valuation gap, investors are buying faster growth: earnings growth estimated around 17.2% compared with roughly 15.0% for the broad benchmark, sales growth of about 9.4% versus 7.4%, and cash-flow growth near 14.0% versus 6.9%. At the macro level, the backdrop is supportive for a growth-heavy momentum ETF at an $85–$86 unit price: the Fed funds rate has already fallen from a peak 5.50–5.75% band to roughly 3.50–3.75%, the market expects two more cuts in 2026, and U.S. GDP printed around 4.3% year-over-year in the September quarter with the Atlanta Fed tracking above 5% for Q4 2025. Earnings forecasts point to about 12.5% S&P 500 EPS growth in 2025 and 15% in 2026, while the tech sector is projected to deliver 25% earnings growth in 2025 and 28% in 2026, with the Magnificent 7 estimated around 22% earnings growth in 2026. That combination of macro support and above-market earnings expansion justifies a higher multiple but also leaves FDMO sensitive to any reversal in the AI and mega-cap growth narrative.

Performance track record of NYSEARCA:FDMO versus Russell 1000 and S&P 500

Since its September 2016 launch, FDMO ETF has delivered exactly what a momentum vehicle is supposed to deliver: excess return at roughly benchmark-like risk. From 2016-09-19 to the latest full data window, the total return is about 283.6% versus 269.4% for a Russell 1000 tracker, with annualized returns of 15.45% for FDMO against 14.98% for the benchmark. Maximum drawdown sits around -33.9% for FDMO versus -34.6% for the Russell 1000, and volatility is roughly 16–17% for both. Over the last 12 months, the outperformance gap is much cleaner: FDMO ETF is up about 22.85%, while a Russell-style index fund is up about 16.01%, giving the momentum sleeve about 680 basis points of excess performance. The three-year picture is even more powerful: FDMO price has approximately doubled, delivering a ~100% price return, while the S&P 500 has gained around 73% over the same period. Sharpe ratios in comparative studies come in near 0.7–0.8 for FDMO, on par or better than broad beta, which confirms that investors have so far been compensated for the extra factor risk rather than simply taking more volatility for the same return.

How NYSEARCA:FDMO stacks up against other momentum ETFs

Within the momentum ETF universe, FDMO ETF competes with MTUM, SPMO, PDP, JMOM and VFMO. Compared over a common window starting in early 2018, FDMO is not the biggest, not the cheapest, but one of the top performers on total return and risk-adjusted return. Assets under management around $640 million and average dollar volume in the low single-digit millions keep it well below MTUM and SPMO in scale, but large enough for professional use. Expense ratio at 0.15% matches MTUM and sits just above SPMO and VFMO, both near 0.13%. On performance since February 2018, SPMO has the strongest track record and highest Sharpe ratio, with FDMO in second place and ahead of MTUM, PDP, JMOM and VFMO. That tells you the FDMO construction – blending technical momentum with earnings-surprise and short-interest filters and running sector-neutral – has produced consistent alpha, even if a pure technical strategy like SPMO has been slightly more efficient in the latest cycle. Investors who want the biggest pure-S&P 500 momentum overlay may lean toward SPMO, while those who want a broader large- and mid-cap universe with sentiment signals included can justify paying the same 0.15% fee for FDMO.

Macro, earnings and factor backdrop supporting the FDMO ETF into 2026

The 2026 setup for NYSEARCA:FDMO is built on three pillars: easier policy, strong earnings and a market that is still rewarding AI-linked growth. Fed funds have already come down by 200 basis points from cycle highs, forward curves price more easing, and GDP growth in the 4–5% band keeps top-line expansion intact. The S&P 500 is projected to move from about 12.5% EPS growth in 2025 to 15% in 2026, while technology earnings growth in the mid-20s and Magnificent 7 EPS growth above 20% feed directly into the core holdings of FDMO ETF. On top of that, historical data on war-related drawdowns suggest an average equity selloff of about 5% around major conflicts, with relatively fast normalization once the macro path is clear, which matches the view that geopolitical shocks hit volatility and oil prices harder than broad earnings in the medium term. For a fund whose top holdings are NVDA, MSFT, GOOGL, AMZN, AVGO, META and TSLA, the key driver is not whether GDP dips 50 basis points, but whether AI capex, cloud spend and semiconductor demand stay on their current trajectory. As long as those lines move up, the momentum factor remains supported and FDMO can continue to outrun the index.

Risk profile, volatility and drawdown characteristics of NYSEARCA:FDMO

The price behavior of FDMO ETF is exactly what you would expect from a concentrated growth-momentum strategy. Standard deviation around 14% and annualized volatility close to 22% sit well above the median of all ETFs, which sits near 9.6% standard deviation and 16.5% volatility. During stress periods such as the tariff-driven selloff in early 2025, momentum products, including FDMO, fell faster than the broad market, reflecting the classic momentum crash risk when factor positioning unwinds. Sensitivity to tech and AI-driven corrections is high, because roughly a third of the portfolio is in technology, another chunk in communication services, and the bulk of the alpha has come from the same group of mega-cap names. The sector-neutral design reduces single-sector overweight relative to the parent, but it does not protect against a synchronized derating of growth and AI across the entire market. Liquidity is acceptable but not outstanding; with about 3K shares of average daily volume, larger orders need to be executed with care, using limits and watching spreads, although the underlying mega-caps are extremely liquid. Investors must treat NYSEARCA:FDMO as an aggressive factor tilt, not as a low-volatility core holding.

Final stance: NYSEARCA:FDMO – buy, sell or hold going into 2026

Taken together, the data say the following: FDMO ETF is trading near $86, close to its $88.09 52-week high, on a P/E a little above 31, P/B above 6, and a 0.60% yield, with a three-year 100% price gain versus roughly 73% for the S&P 500 and a long-term annualized return above 15% with no worse drawdown than the Russell 1000. The portfolio is concentrated in the strongest structural winners of this cycle, macro and earnings forecasts still favor high-growth tech and AI, and the strategy has already proven it can beat both the broad market and most momentum peers over meaningful time windows. The cost is elevated volatility and high sensitivity to any broad derating of growth or AI narratives. For an investor who understands those risks and wants a factor-tilted way to lean into U.S. large- and mid-cap momentum, the numbers justify a clear Buy rating on NYSEARCA:FDMO at current levels, with the caveat that this is an aggressive, cycle-dependent allocation, not a sleep-well-at-night core holding.

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