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Is American Century U.S. Quality Growth ETF (QGRO) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - All Cap Growth category of the market, the American Century U.S. Quality Growth ETF (QGRO - Free Report) is a smart beta exchange traded fund launched on 09/10/2018.
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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking 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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by American Century Investments. QGRO has been able to amass assets over $1.11 billion, making it one of the larger ETFs in the Style Box - All Cap Growth. QGRO seeks to match the performance of the AMERICAN CENTURY U.S. QUALITY GROWTH IND before fees and expenses.
The American Century U.S. Quality Growth Index seeks to select securities of large and mid-capitalization U.S. companies with attractive growth and quality fundamentals.
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.
Operating expenses on an annual basis are 0.29% for QGRO, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.25%.
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.
QGRO's heaviest allocation is in the Information Technology sector, which is about 34.80% of the portfolio. Its Consumer Discretionary and Industrials round out the top three.
Taking into account individual holdings, Netflix Inc Common Stock Usd.001 (NFLX - Free Report) accounts for about 3.62% of the fund's total assets, followed by Booking Holdings Inc Common Stock Usd.008 (BKNG - Free Report) and Tjx Companies Inc Common Stock Usd1.0 (TJX - Free Report) .
Its top 10 holdings account for approximately 29.25% of QGRO's total assets under management.
Performance and Risk
The ETF has gained about 1.56% so far this year and was up about 34.54% in the last one year (as of 01/09/2025). In the past 52-week period, it has traded between $76.13 and $106.37.
The fund has a beta of 1.07 and standard deviation of 21.63% for the trailing three-year period. With about 202 holdings, it effectively diversifies company-specific risk.
Alternatives
American Century U.S. Quality Growth ETF is an excellent option for investors seeking to outperform the Style Box - All Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Fidelity Blue Chip Growth ETF (FBCG - Free Report) tracks ---------------------------------------- and the iShares Core S&P U.S. Growth ETF (IUSG - Free Report) tracks S&P 900 Growth Index. Fidelity Blue Chip Growth ETF has $2.94 billion in assets, iShares Core S&P U.S. Growth ETF has $21.36 billion. FBCG has an expense ratio of 0.59% and IUSG charges 0.04%.
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 - All Cap Growth.
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 American Century U.S. Quality Growth ETF (QGRO) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - All Cap Growth category of the market, the American Century U.S. Quality Growth ETF (QGRO - Free Report) is a smart beta exchange traded fund launched on 09/10/2018.
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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking 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.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by American Century Investments. QGRO has been able to amass assets over $1.11 billion, making it one of the larger ETFs in the Style Box - All Cap Growth. QGRO seeks to match the performance of the AMERICAN CENTURY U.S. QUALITY GROWTH IND before fees and expenses.
The American Century U.S. Quality Growth Index seeks to select securities of large and mid-capitalization U.S. companies with attractive growth and quality fundamentals.
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.
Operating expenses on an annual basis are 0.29% for QGRO, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.25%.
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.
QGRO's heaviest allocation is in the Information Technology sector, which is about 34.80% of the portfolio. Its Consumer Discretionary and Industrials round out the top three.
Taking into account individual holdings, Netflix Inc Common Stock Usd.001 (NFLX - Free Report) accounts for about 3.62% of the fund's total assets, followed by Booking Holdings Inc Common Stock Usd.008 (BKNG - Free Report) and Tjx Companies Inc Common Stock Usd1.0 (TJX - Free Report) .
Its top 10 holdings account for approximately 29.25% of QGRO's total assets under management.
Performance and Risk
The ETF has gained about 1.56% so far this year and was up about 34.54% in the last one year (as of 01/09/2025). In the past 52-week period, it has traded between $76.13 and $106.37.
The fund has a beta of 1.07 and standard deviation of 21.63% for the trailing three-year period. With about 202 holdings, it effectively diversifies company-specific risk.
Alternatives
American Century U.S. Quality Growth ETF is an excellent option for investors seeking to outperform the Style Box - All Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Fidelity Blue Chip Growth ETF (FBCG - Free Report) tracks ---------------------------------------- and the iShares Core S&P U.S. Growth ETF (IUSG - Free Report) tracks S&P 900 Growth Index. Fidelity Blue Chip Growth ETF has $2.94 billion in assets, iShares Core S&P U.S. Growth ETF has $21.36 billion. FBCG has an expense ratio of 0.59% and IUSG charges 0.04%.
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 - All Cap Growth.
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.