The SPDR technology ETF is dominated by a handful of giant stocks, including Apple ( AAPL), International Business Machines ( IBM), and Microsoft ( MSFT). Fidelity's portfolio manager Charlie Chai ranges more widely, buying small stocks and foreign issues as well as familiar blue chips. Chai holds a mix that includes rapid growers as well as cyclical names that have fallen out of favor. A growth star in the fund has been Salesforce.com ( CRM), which delivers software from the cloud that can be used by companies to provide customer service. Chai says that the company can continue growing for a sustained period. "They are taking market share away from established software competitors like Oracle ( ORCL)," he says. Chai aims to buy cyclicals when they are out of favor. A cyclical holding is Micron Technology ( MU), which makes semiconductors that are used for data storage. Some holdings are stable performers that can increase sales at annual rates of 10% or so. A stable holding is Visa ( V). As a dominant player in the expanding credit-card business, the company can continue growing steadily. Despite the strong returns of the Fidelity sector funds, many investors prefer ETFs because they offer some key advantages. While mutual funds like Fidelity's are only priced once a day at the market close, investors can trade ETFs constantly. Many ETFs can be tax efficient. But the Fidelity funds could soon be offered as ETFs. Fidelity has filed with the SEC to begin providing actively managed ETFs. So far Fidelity has only filed to open a bond fund, but more active ETFs are likely to follow, says Pooneh Baghai, a consultant with McKinsey. She says that Fidelity is likely to roll out a host of active ETFs, including portfolios that are based on the sector funds. When that happens, Fidelity investors will be able benefit from the lower costs of ETFs and from Fidelity's experienced active sector managers. At the time of publication the author held no positions in any of the stocks mentioned.Follow @StanLuxenbergThis article is commentary by an independent contributor, separate from TheStreet's regular news coverage.