Yahoo Finance Is SPDR MSCI USA StrategicFactors ETF (QUS) a Strong ETF Right Now?
A smart beta exchange traded fund, the SPDR MSCI USA StrategicFactors ETF (QUS) debuted on 04/15/2015, and offers 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
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
The fund is sponsored by State Street Global Advisors. It has amassed assets over $1.24 billion, making it one of the larger ETFs in the Style Box - Large Cap Blend. QUS, before fees and expenses, seeks to match the performance of the MSCI USA Factor Mix A-Series Index.
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
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.
With one of the cheaper products in the space, this ETF has annual operating expenses of 0.15%.
The fund has a 12-month trailing dividend yield of 1.49%.
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 25.40% of the portfolio. Its Healthcare and Financials round out the top three.
When you look at individual holdings, Microsoft Corp (MSFT) accounts for about 3.02% of the fund's total assets, followed by Nvidia Corp (NVDA) and Meta Platforms Inc Class A (META).
Its top 10 holdings account for approximately 22.46% of QUS's total assets under management.
Performance and Risk
The ETF has gained about 5.34% so far this year and is up roughly 19.49% in the last one year (as of 05/02/2024). In the past 52-week period, it has traded between $115.28 and $145.63.
The fund has a beta of 0.91 and standard deviation of 15.29% for the trailing three-year period, which makes QUS a medium risk choice in this particular space. With about 609 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) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY) tracks S&P 500 Index. IShares Core S&P 500 ETF has $433.87 billion in assets, SPDR S&P 500 ETF has $497.21 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.
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SPDR MSCI USA StrategicFactors ETF (QUS): ETF Research Reports
Microsoft Corporation (MSFT) : Free Stock Analysis Report
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
SPDR S&P 500 ETF (SPY): ETF Research Reports
iShares Core S&P 500 ETF (IVV): ETF Research Reports
Meta Platforms, Inc. (META) : Free Stock Analysis Report
