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 USA StrategicFactors ETF (QUS) a Strong ETF Right Now?
Read MoreHide Full Article
Designed to provide broad exposure to the Style Box - Large Cap Blend category of the market, the SPDR MSCI USA StrategicFactors ETF (QUS - Free Report) is a smart beta exchange traded fund launched on 04/15/2015.
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.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of 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
Managed by State Street Global Advisors, QUS has amassed assets over $983.53 million, making it one of the larger ETFs in the Style Box - Large Cap Blend. This particular fund seeks to match the performance of the MSCI USA Factor Mix A-Series Index before fees and expenses.
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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for QUS are 0.15%, which makes it one of the cheaper products in the space.
QUS's 12-month trailing dividend yield is 1.60%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, 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 24.50% of the portfolio. Its Healthcare and Financials round out the top three.
Looking at individual holdings, Microsoft Corporation (MSFT - Free Report) accounts for about 3.38% of total assets, followed by Apple Inc. (AAPL - Free Report) and Meta Platforms Inc. Class A (META - Free Report) .
QUS's top 10 holdings account for about 22.14% of its total assets under management.
Performance and Risk
The ETF has gained about 11.68% so far this year and was up about 16.34% in the last one year (as of 06/16/2023). In the past 52-week period, it has traded between $101.25 and $122.33.
The ETF has a beta of 0.92 and standard deviation of 16.41% for the trailing three-year period, making it a medium risk choice in the space. With about 627 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 $330.11 billion in assets, SPDR S&P 500 ETF has $417.82 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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is SPDR MSCI USA StrategicFactors ETF (QUS) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Large Cap Blend category of the market, the SPDR MSCI USA StrategicFactors ETF (QUS - Free Report) is a smart beta exchange traded fund launched on 04/15/2015.
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.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of 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
Managed by State Street Global Advisors, QUS has amassed assets over $983.53 million, making it one of the larger ETFs in the Style Box - Large Cap Blend. This particular fund seeks to match the performance of the MSCI USA Factor Mix A-Series Index before fees and expenses.
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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for QUS are 0.15%, which makes it one of the cheaper products in the space.
QUS's 12-month trailing dividend yield is 1.60%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, 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 24.50% of the portfolio. Its Healthcare and Financials round out the top three.
Looking at individual holdings, Microsoft Corporation (MSFT - Free Report) accounts for about 3.38% of total assets, followed by Apple Inc. (AAPL - Free Report) and Meta Platforms Inc. Class A (META - Free Report) .
QUS's top 10 holdings account for about 22.14% of its total assets under management.
Performance and Risk
The ETF has gained about 11.68% so far this year and was up about 16.34% in the last one year (as of 06/16/2023). In the past 52-week period, it has traded between $101.25 and $122.33.
The ETF has a beta of 0.92 and standard deviation of 16.41% for the trailing three-year period, making it a medium risk choice in the space. With about 627 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 $330.11 billion in assets, SPDR S&P 500 ETF has $417.82 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.