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Is SPDR MSCI USA StrategicFactors ETF (QUS) a Strong ETF Right Now?

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Launched on 04/15/2015, the SPDR MSCI USA StrategicFactors ETF (QUS - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Blend 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.

However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.

By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.

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 State Street Global Advisors, and has been able to amass over $1.49 billion, which makes it one of the larger ETFs in the Style Box - Large Cap Blend. Before fees and expenses, QUS seeks to match the performance of the MSCI USA Factor Mix A-Series Index.

The MSCI USA Factor Mix A-Series Capped Index seeks to measure the equity market performance of large and mid-cap companies across the U.S. equity market.

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.

Operating expenses on an annual basis are 0.15% for this ETF, which makes it one of the cheaper products in the space.

It's 12-month trailing dividend yield comes in at 1.46%.

Sector Exposure and Top Holdings

Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.

For QUS, it has heaviest allocation in the Information Technology sector --about 23.70% of the portfolio --while Financials and Healthcare round out the top three.

Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 3.08% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Meta Platforms Inc Class A (META - Free Report) .

The top 10 holdings account for about 21.01% of total assets under management.

Performance and Risk

Year-to-date, the SPDR MSCI USA StrategicFactors ETF has added roughly 2.29% so far, and it's up approximately 11.24% over the last 12 months (as of 05/13/2025). QUS has traded between $140.84 and $163.91 in this past 52-week period.

The ETF has a beta of 0.89 and standard deviation of 15.28% for the trailing three-year period, making it a medium risk choice in the space. With about 579 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.

SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index and the Vanguard S&P 500 ETF (VOO - Free Report) tracks S&P 500 Index. SPDR S&P 500 ETF has $592.21 billion in assets, Vanguard S&P 500 ETF has $636.46 billion. SPY has an expense ratio of 0.09% and VOO charges 0.03%.

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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