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Is FlexShares International Quality Dividend ETF (IQDF) a Strong ETF Right Now?

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A smart beta exchange traded fund, the FlexShares International Quality Dividend ETF (IQDF - Free Report) debuted on 04/12/2013, and offers broad exposure to the World ETFs category of the market.

What Are Smart Beta ETFs?

Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.

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.

But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.

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.

Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.

Fund Sponsor & Index

IQDF is managed by Flexshares, and this fund has amassed over $811.12 million, which makes it one of the larger ETFs in the World ETFs. IQDF seeks to match the performance of the Northern Trust International Quality Dividend Index before fees and expenses.

The Northern Trust International Quality Dividend Index is designed to provide exposure to a high-quality income-oriented portfolio of long-only international securities issued by non-U.S.-based companies, with an emphasis on long-term capital growth and a targeted overall beta that is similar to that of the Northern Trust International Large Cap Index.

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 IQDF are 0.47%, which makes it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 6.23%.

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.

When you look at individual holdings, Taiwan Semiconductor Manufacturing Co Ltd Commonaccounts for about 2.73% of the fund's total assets, followed by Cash and Bhp Group Ltd Common Stock Aud 0 (BHP).

IQDF's top 10 holdings account for about 18.64% of its total assets under management.

Performance and Risk

Year-to-date, the FlexShares International Quality Dividend ETF has added about 25.53% so far, and is up about 13.5% over the last 12 months (as of 09/29/2025). IQDF has traded between $22.10 $28.94 in this past 52-week period.

The fund has a beta of 0.75 and standard deviation of 14.60% for the trailing three-year period, which makes IQDF a medium risk choice in this particular space. With about 320 holdings, it effectively diversifies company-specific risk .

Alternatives

FlexShares International Quality Dividend ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.

FlexShares International Quality Dividend Dynamic ETF(IQDY) tracks Northern Trust International Quality Dividend Dynamic Index The fund has $80.71 million in assets. IQDY has an expense ratio of 0.47%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the 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.

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