Fidelity Momentum Factor ETF (FDMO) Covered Calls
The Fidelity Momentum Factor ETF (FDMO) is a passively managed fund that tracks the Fidelity U.S. Momentum Factor Index. It provides exposure to U.S. large- and mid-capitalization stocks that exhibit positive momentum signals, aiming to capitalize on the market tendency for assets with recent strong price trends to continue that performance in the near term.
You can sell covered calls on Fidelity Momentum Factor ETF to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for FDMO (prices last updated Thu 12:40 PM ET):
| Fidelity Momentum Factor ETF (FDMO) Stock Quote | ||||||
|---|---|---|---|---|---|---|
| Last | Change | Bid | Ask | Volume | P/E | Market Cap |
| 82.09 | -0.97 | 82.02 | 82.16 | 44K | - | 0.0 |
| Covered Calls For Fidelity Momentum Factor ETF (FDMO) | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Net Debit | Return If Flat |
Annualized Return If Flat |
|
| Mar 20 | 82 | 0.00 | 82.16 | -0.2% | -8.1% | |
| Apr 17 | 82 | 0.85 | 81.31 | 0.8% | 7.9% | |
| Subscribers get access to the full covered call chain, and more features. | ||||||
Want to make money with covered calls? Sign Up For A Free Trial
The Fidelity Momentum Factor ETF (FDMO) employs a systematic, rules-based approach to capture the momentum risk premium. By screening the U.S. equity market for stocks displaying strong upward price trends and positive momentum characteristics, the fund constructs a portfolio designed to outperform broad market indices during trending market environments.
The fund is rebalanced quarterly to ensure that its holdings remain aligned with current market signals. While momentum strategies can provide significant upside in persistent bull markets, they are inherently subject to higher volatility and the risk of rapid reversals when market sentiment shifts. As a factor-tilted vehicle, FDMO is often used by investors as a tactical allocation tool rather than a static core holding.
Competitive Landscape
FDMO competes within the highly specialized "momentum factor" segment of the ETF market. Investors seeking liquid, optionable alternatives to compare or pair with FDMO frequently look at the iShares MSCI USA Momentum Factor ETF (MTUM) and the Invesco DWA Momentum ETF (PDP). These funds are widely recognized industry benchmarks for momentum-based equity strategies and feature robust options liquidity suitable for hedging and income generation.
Strategic Outlook and Innovation
The strategic outlook for FDMO is centered on the persistence of price momentum as a reliable market factor. Fidelity’s quantitative team continuously monitors the fund’s index construction to balance momentum exposure with sector diversification, attempting to avoid excessive concentration in singular, overextended sectors. Innovation at the fund level is focused on refining the "momentum signal" to better distinguish between sustained performance and speculative bubbles, aiming to deliver cleaner factor exposure to investors.
| Top 10 Open Interest For Mar 20 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA covered calls | 6. | QQQ covered calls | 1. | CTMX covered calls | |
| 2. | SLV covered calls | 7. | EWZ covered calls | 2. | S covered calls | |
| 3. | EEM covered calls | 8. | FXI covered calls | 3. | USO covered calls | |
| 4. | SPY covered calls | 9. | GLD covered calls | 4. | ONDS covered calls | |
| 5. | IBIT covered calls | 10. | KWEB covered calls | 5. | ADBE covered calls | |
Want more examples? FDLO Covered Calls | FDN Covered Calls
Risk Disclosure: Trading options involves significant risk and is not suitable for all investors. The information provided on this website is for educational and informational purposes only and does not constitute financial, investment, tax, or legal advice. Nothing contained on this site is an offer to buy or sell, or a solicitation of an offer to buy or sell, any securities or financial instruments.
Covered Call Strategy Risks: While covered call writing is often considered a conservative options strategy, it is not without risk. By selling a covered call, you are limiting your potential upside profit from the underlying stock. You remain exposed to the full downside risk of owning the underlying stock. In the event of a significant decline in the stock price, the premium received may not be sufficient to offset your losses.
No Guarantee of Performance: Past performance is not indicative of future results. Any examples, calculations, or hypothetical scenarios presented on this site are for illustrative purposes only and do not guarantee future returns or outcomes. Market conditions, liquidity, and trading system failures can affect your ability to execute trades at desired prices.
You should consult with a qualified professional advisor and conduct your own due diligence before making any investment decisions. By using this website, you acknowledge that you are responsible for your own investment decisions and agree to release this site and its affiliates from any liability relating to your use of this information. See the OCC's Characteristics and Risks of Standardized Options for more info.
