Fidelity^® Core Bond strategy FAQs

• How can this strategy help me meet my goals?

  Investing in a portfolio of taxable bonds can be an attractive option for investors who want broad exposure to investment-grade bonds or are seeking a source of income.

  This separately managed account is designed to offer investors a diversified portfolio of investment-grade taxable bonds that is designed to deliver interest income while limiting risk to principal over a full market cycle. Unlike some other investment vehicles, a separately managed account allows account holders to directly own the bonds, so they will know which bonds the manager has selected for their accounts and how their investments are being managed.

• Who manages my money?

  Strategic Advisers LLC (Strategic Advisers), has engaged Fidelity Management & Research Company LLC, a registered investment adviser and a Fidelity Investments company, to provide the day-to-day discretionary portfolio management of Fidelity Core Bond Strategy accounts, including investment selection and trade execution, subject to Strategic Advisers’ oversight.

  The investment team at Fidelity Management & Research Company LLC will construct each portfolio and make the day-to-day investment and trading decisions for each account. Fidelity Management & Research Company LLC's team of analysts, portfolio managers, and traders specialize in the fixed income market and work together to monitor both the markets and each client account in an effort to uncover hidden opportunities in different types of markets. Their careful market analysis enables them to build diversified bond strategies that include a range of issuers, regions, sectors, and maturities to generate income while seeking to help manage risk.

• What kind of investments can I expect in my account?

  The investment team will typically select 30-80 bonds⁶ and a Fidelity exchange-traded fund ('ETF'), per account, and may invest in a mix of corporate bonds, U.S. Treasuries, government agencies, mortgage and asset-backed bonds, taxable municipal bonds, and floating-rate bonds. Each account will contain investment-grade taxable bonds rated BBB− or higher at time of purchase. The investment team will seek to maintain an overall portfolio credit rating average of A−. Please be aware that lower-rated bonds do carry additional risk compared to higher-rated bonds.

• Why will my account hold a Fidelity exchange-traded fund?

  The Fidelity Investment Grade Securitized ETF (FSEC) offers access to a professionally managed portfolio of securitized fixed income instruments—including mortgage-backed securities (MBS), commercial mortgage-backed securities (CMBS), and asset-backed securities (ABS).

  These types of securities can provide distinct risk and return characteristics compared to traditional corporate or government bonds. By incorporating FSEC, your portfolio gains exposure to a segment of the bond market that is typically less accessible to individual investors. Additionally, the ETF structure provides benefits such as daily liquidity and operational efficiency.

  This addition supports the ongoing effort to enhance diversification within your Core Bond SMA, helping to broaden exposure across different fixed income sectors,

• How are the bonds chosen for my account?

  The investment team looks at many factors when assessing risk for each proposed bond, including but not limited to issuer-specific credit risk, sector risk, interest rate risk, and liquidity risk. The team assigns a proprietary credit rating to each bond they purchase, that is independent of the rating agencies. The team focuses on selecting investment-grade bonds which offer strong relative value in an effort to generate income while seeking to limit risk to the money invested.

  Each account is diversified across a variety of sectors and maturities to help ensure it is not concentrated in any one area, can better handle changes in interest rates, and can potentially help reduce overall risk to principal over the long-term.

• Can I choose my own investments?

  The investment team at Fidelity Management & Research Company LLC will select all bonds for each account. They may be able to build an investor's portfolio around certain investment-grade taxable bonds already owned, provided the bonds meet the selection criteria and overall portfolio investment guidelines.

• How long will it take to invest my account?

  In general, under normal market conditions, it will take 60 to 90 days⁷ to construct a complete portfolio. While each account is reviewed on a daily basis, it's normal to not see initial trades for the first few weeks. The investment team at Fidelity Management & Research Company LLC takes great effort in creating thoughtfully researched, personalized portfolios that are designed for each client's financial goals, and will carefully evaluate each bond selected in an effort to create a portfolio that is well-diversified across sectors and maturities.

• Can I add funds to my account?

  Yes, investors can add funds to their account. 

• Will bonds be held to maturity in my account?
  Bonds can be sold prior to maturity when market opportunities or portfolio needs arise. While the investment team manages the portfolio with a focus on maintaining low turnover, trades may be made to enhance return potential and manage risk. These decisions are typically driven by factors such as changes in credit quality, relative value opportunities through security selection, strategic yield curve positioning, or evolving cash flow needs.
• Can I withdraw funds from my account?

  Yes, an investor can request a withdrawal from his or her account at any time, with no Fidelity fees or penalties. We will process all withdrawal requests promptly, but please note that it may take several business days to complete a withdrawal.