Investing Port

The iShares Edge MSCI U.S.A. Quality Factor ETF (QUAL) tracks an index that selects large- and mid-cap U.S. stocks based on quality factors like stable earnings growth and low debt-to-equity. QUAL is priced competitively with other single-factor funds that invest in U.S. equities. The fund owns more than 100 securities. As with many single-factor funds, QUAL isn’t diversified enough stand alone as a core U.S. equity holding. It is more likely to be useful to investors who want to overlay a quality tilt on top of a core allocation to U.S. markets.

There has been a proliferation of factor funds in recent years, and investors can compare QUAL to rivals like the Xtrackers Russell 1000 US Quality at a Reasonable Price ETF (QARP), the Schwab Fundamental U.S. Large Cap Company Index ETF (FNDX), or the JPMorgan U.S. Quality Factor ETF (JQUA). Cost-conscious investors might prefer ultra-low-cost plain vanilla U.S. funds like the Vanguard Total Stock Market ETF (VTI) or the iShares S&P 500 ETF (IVV).