Fidelity Dividend ETF for Rising Rates (FDRR) has $676M in assets and delivered 23% price return over the past year, outpacing SPDR S&P 500 ETF (SPY)\u2019s 21% gain. Top holdings include Nvidia, Apple, Microsoft, Alphabet, and Broadcom representing 28% of the fund with a 1.98% yield.<\/p>\n
FDRR\u2019s rate-resilience strategy concentrates heavily in technology and cyclicals rather than traditional dividend stocks, making it a total-return vehicle unsuitable as a primary income source for retirees.<\/p>\n
The analyst who called NVIDIA in 2010 just named his top 10 AI stocks. Get them here FREE<\/a>.<\/p>\n Retirees building income portfolios in 2026 face a genuine tension: bond yields have pulled back from recent highs, dividend stocks feel crowded, and the funds marketed as “rate-resilient” often look nothing like their names suggest once you open the hood. Fidelity Dividend ETF for Rising Rates (NYSEARCA:FDRR<\/a>) is one of those funds worth examining closely before assuming the label tells the whole story.<\/p>\n FDRR screens for dividend-paying stocks with positive sensitivity to rising interest rates, meaning it tilts toward companies whose earnings and valuations tend to hold up or improve when rates climb. The practical result is a portfolio that leans heavily on financials, cyclicals, and technology rather than the bond-like utilities and REITs that dominate most dividend funds. Real estate sits at 0% of the portfolio, while utilities represent just 2.2%, a stark contrast to income-focused peers like iShares Core High Dividend ETF (NYSEARCA:HDV<\/a>) or Vanguard High Dividend Yield ETF (NYSEARCA:VYM<\/a>).<\/p>\n The fund carries a 0.15% expense ratio and has been running since September 2016, giving it nearly a decade of real-world track record. With $676 million in net assets and a portfolio turnover of 0.27, it operates more like a patient, buy-and-hold vehicle than an actively traded strategy.<\/p>\n READ: The analyst who called NVIDIA in 2010 just named his top 10 AI stocks<\/a><\/p>\n The top five holdings tell a story that may surprise income-focused investors. Nvidia, Apple, Microsoft, Alphabet, and Broadcom together represent roughly 28% of the fund, and information technology alone accounts for 31% of total allocation. These are dividend payers, technically, but their yields are modest and their valuations are driven far more by growth expectations than income generation.<\/p>\n The stated yield of 1.98% sits well below the 10-year Treasury yield of 4.15%, which means retirees seeking income replacement cannot rely on FDRR distributions alone. The fund is better understood as a total-return vehicle that happens to pay dividends.<\/p>\n Story Continues <\/p>\n The annual payout has grown steadily, from $0.948 per share in 2021 to $1.347 per share in 2025, a sign of underlying earnings growth in the portfolio. However, the quarterly amounts vary enough to complicate budget planning, as seen in the difference between the June 2025 distribution of $0.401 and the March 2025 distribution of $0.299, which can make month-to-month cash-flow planning less predictable for retirees who depend on consistent income.<\/p>\n Over the past year, FDRR has delivered a 23% price return, edging past SPDR S&P 500 ETF Trust (NYSEARCA:SPY<\/a>)’s 21% gain over the same period. That modest outperformance is meaningful context: in an environment where the Fed cut rates by 75 basis points over 12 months, a fund designed for rising rates still kept pace with the broad market.<\/p>\n Zoom out further and the picture is essentially a draw \u2014 FDRR up 74% over five years versus SPY’s SPY up 73% \u2014 suggesting the rate-resilience tilt neither meaningfully hurts nor dramatically helps total returns over a full cycle.<\/p>\n Year-to-date in 2026, FDRR is roughly flat, up 0.22% while SPY is down 0.21%. The spread is narrow, but FDRR’s slight edge during a choppy early 2026 market does reflect the defensive tilt the fund aims for. The yield curve spread sitting at a positive 0.56% signals no near-term recession warning, which supports the fund’s cyclical and financial sector exposure.<\/p>\n Three constraints matter most for retirees evaluating FDRR. First, the yield is thin for income-replacement purposes. At roughly 2%, it functions better as a total-return complement than a primary income source. Second, the heavy technology weighting means the fund is more correlated to growth-stock volatility than its “dividend” label implies. A sharp repricing in large-cap tech would hit FDRR harder than a traditional dividend fund. Third, the quarterly distribution variability makes cash-flow planning less predictable than a fixed-income ladder or a higher-yield dividend ETF.<\/p>\n Wall Street is pouring billions into AI, but most investors are buying the wrong stocks. The analyst who first identified NVIDIA as a buy back in 2010 \u2014 before its 28,000% run \u2014 has just pinpointed 10 new AI companies he believes could deliver outsized returns from here. One dominates a $100 billion equipment market. Another is solving the single biggest bottleneck holding back AI data centers. A third is a pure-play on an optical networking market set to quadruple. Most investors haven’t heard of half these names. Get the free list of all 10 stocks here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"Fidelity Dividend ETF for Rising Rates (FDRR) has $676M in assets and delivered 23% price return over the…\n","protected":false},"author":2,"featured_media":332602,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[114,163786,163789,78830,163784,163785,268,85,163787,46,4136,266,267,163788,153666],"class_list":{"0":"post-332601","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-dividend-etf","10":"tag-dividend-funds","11":"tag-dividend-stocks","12":"tag-fdrr","13":"tag-fidelity-dividend-etf-for-rising-rates","14":"tag-finance","15":"tag-il","16":"tag-income-source","17":"tag-israel","18":"tag-nvidia","19":"tag-personal-finance","20":"tag-personalfinance","21":"tag-rising-interest-rates","22":"tag-top-10-ai-stocks"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/332601","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=332601"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/332601\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/332602"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=332601"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=332601"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=332601"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}