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Is SPDR MSCI USA StrategicFactors ETF (QUS) a Strong ETF Right Now?
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The SPDR MSCI USA StrategicFactors ETF (QUS - Free Report) made its debut on 04/15/2015, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $961.88 million, which makes it one of the larger ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund seeks to match the performance of the MSCI USA Factor Mix A-Series Index.
The MSCI USA Factor Mix A-Series Index measures the equity market performance of large and mid-cap companies across the U.S. equity market. It aims to represent the performance of a combination of three factors: value, quality, and low volatility.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for QUS are 0.15%, which makes it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.37%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
QUS's heaviest allocation is in the Information Technology sector, which is about 31.10% of the portfolio. Its Healthcare and Financials round out the top three.
When you look at individual holdings, Microsoft Corporation (MSFT - Free Report) accounts for about 3.52% of the fund's total assets, followed by Apple Inc. (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
QUS's top 10 holdings account for about 21.24% of its total assets under management.
Performance and Risk
So far this year, QUS has lost about -7.01%, and is up roughly 15.63% in the last one year (as of 01/24/2022). During this past 52-week period, the fund has traded between $102.76 and $131.16.
The fund has a beta of 0.93 and standard deviation of 21.50% for the trailing three-year period, which makes QUS a medium risk choice in this particular space. With about 621 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR MSCI USA StrategicFactors ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $307.03 billion in assets, SPDR S&P 500 ETF has $413.17 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is SPDR MSCI USA StrategicFactors ETF (QUS) a Strong ETF Right Now?
The SPDR MSCI USA StrategicFactors ETF (QUS - Free Report) made its debut on 04/15/2015, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $961.88 million, which makes it one of the larger ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund seeks to match the performance of the MSCI USA Factor Mix A-Series Index.
The MSCI USA Factor Mix A-Series Index measures the equity market performance of large and mid-cap companies across the U.S. equity market. It aims to represent the performance of a combination of three factors: value, quality, and low volatility.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for QUS are 0.15%, which makes it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.37%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
QUS's heaviest allocation is in the Information Technology sector, which is about 31.10% of the portfolio. Its Healthcare and Financials round out the top three.
When you look at individual holdings, Microsoft Corporation (MSFT - Free Report) accounts for about 3.52% of the fund's total assets, followed by Apple Inc. (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
QUS's top 10 holdings account for about 21.24% of its total assets under management.
Performance and Risk
So far this year, QUS has lost about -7.01%, and is up roughly 15.63% in the last one year (as of 01/24/2022). During this past 52-week period, the fund has traded between $102.76 and $131.16.
The fund has a beta of 0.93 and standard deviation of 21.50% for the trailing three-year period, which makes QUS a medium risk choice in this particular space. With about 621 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR MSCI USA StrategicFactors ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $307.03 billion in assets, SPDR S&P 500 ETF has $413.17 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.