Fidelity has expanded its ETF arm with yet another high level hire — Greg Friedman, former chief operating officer and global head of ETF product for Russell Investments, according to industry executives. Before that, Friedman has served as a managing director at iShares.

The arm, currently going by the name of SelectCo. saw its first notable hire in March, 2012, when Fido hired Tony Rochte to serve as the division's head. Rochte had previously served as former head of the intermediary business for State Street Global Advisors. Before that, Rochte had worked for Fidelity from 1996 to 2000 in its brokerage business and then spent six years at iShares before joining SSgA in 2006.

Rochte has wasted no time building up his team. Recent hires have included Matt Goulet as vice president of business strategy.

According to an industry expert, the hires reflect Fidelity's desire to maintain its existing customer relationships by offering a full product lineup.

"No doubt, they would love to have customers load up in their actively-managed funds, but at the end of the day Fidelity wants to keep its customer base, and some customers have and will continue to migrate to ETFs. So they have to go into the business," the expert told MFWire."They can't keep their head in the sand."

The industry expert shrugged off the timing of Fidelity's ETF buildout and the fact that other firms are already established in this space, arguing than in two years "it will be seamless, as competitive as everyone else in this niche."

"This is not some huge undertaking that will take 15-years or more to complete, you can build up in this space pretty quickly," said the expert. "It is easy to hire somebody with the battle scars who can say 'Let's take what we know and adapt it to the Fidelity platform.'" 

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