We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is SPDR MSCI EAFE StrategicFactors ETF (QEFA) a Strong ETF Right Now?
Read MoreHide Full Article
Making its debut on 06/04/2014, smart beta exchange traded fund SPDR MSCI EAFE StrategicFactors ETF (QEFA - Free Report) provides investors broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Managed by State Street Global Advisors, QEFA has amassed assets over $882.82 million, making it one of the average sized ETFs in the Broad Developed World ETFs. QEFA, before fees and expenses, seeks to match the performance of the MSCI EAFE Factor Mix A-Series Index.
The MSCI EAFE Factor Mix A-Series Index captures large and mid-cap representation across 22 developed market Europe, Australasia, and Far East countries and aims to represent the performance of value, low volatility, and quality factor strategies.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for QEFA are 0.30%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.82%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
When you look at individual holdings, Novo Nordisk A/s B (NOVOB) accounts for about 2.85% of the fund's total assets, followed by Nestle Sa Reg (NESN) and Roche Holding Ag Genusschein (ROG - Free Report) .
The top 10 holdings account for about 16.58% of total assets under management.
Performance and Risk
The ETF has added about 6.25% and is up about 13.61% so far this year and in the past one year (as of 11/09/2023), respectively. QEFA has traded between $63.16 and $71.82 during this last 52-week period.
QEFA has a beta of 0.77 and standard deviation of 15.46% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 708 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR MSCI EAFE StrategicFactors ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI EAFE ETF (EFA - Free Report) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA - Free Report) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $46.36 billion in assets, iShares Core MSCI EAFE ETF has $96.15 billion. EFA has an expense ratio of 0.33% and IEFA charges 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is SPDR MSCI EAFE StrategicFactors ETF (QEFA) a Strong ETF Right Now?
Making its debut on 06/04/2014, smart beta exchange traded fund SPDR MSCI EAFE StrategicFactors ETF (QEFA - Free Report) provides investors broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Managed by State Street Global Advisors, QEFA has amassed assets over $882.82 million, making it one of the average sized ETFs in the Broad Developed World ETFs. QEFA, before fees and expenses, seeks to match the performance of the MSCI EAFE Factor Mix A-Series Index.
The MSCI EAFE Factor Mix A-Series Index captures large and mid-cap representation across 22 developed market Europe, Australasia, and Far East countries and aims to represent the performance of value, low volatility, and quality factor strategies.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for QEFA are 0.30%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.82%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
When you look at individual holdings, Novo Nordisk A/s B (NOVOB) accounts for about 2.85% of the fund's total assets, followed by Nestle Sa Reg (NESN) and Roche Holding Ag Genusschein (ROG - Free Report) .
The top 10 holdings account for about 16.58% of total assets under management.
Performance and Risk
The ETF has added about 6.25% and is up about 13.61% so far this year and in the past one year (as of 11/09/2023), respectively. QEFA has traded between $63.16 and $71.82 during this last 52-week period.
QEFA has a beta of 0.77 and standard deviation of 15.46% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 708 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR MSCI EAFE StrategicFactors ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI EAFE ETF (EFA - Free Report) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA - Free Report) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $46.36 billion in assets, iShares Core MSCI EAFE ETF has $96.15 billion. EFA has an expense ratio of 0.33% and IEFA charges 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
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.