State Street Takes Quality Approach to Country ETFs

Fresh off last week’s launch of three exchange traded emphasizing multi-factor, State Street’s (NYSEArca: STT) State Street Global Advisors unit, the second-largest U.S. ETF issuer, has taken the quality approach to the single-country level with the debut of six new ETFs today.

As is the case with the three diversified quality ETFs launched by SSgA last week, all six of the country-specific offerings that debuted today track MSCI indices. The quality factor “captures excess returns to stocks that are characterized by low debt, stable earnings growth and other ‘quality’ metrics,” according to MSCI.

Although Spain is not the largest economy tracked by the six new SSgA ETFs, arguably one of the suite’s more interesting constituents is the SPDR MSCI Spain Quality Mix ETF (NYSEArca: QESP). QESP is just the second Spain ETF to list in the U.S. and will compete with the iShares MSCI Spain Capped ETF (NYSEArca: EWP).

QESP’s timing could prove fortunate as EWP is up 16% this year and Spanish 10-year bonds now sport yields on par with their U.S. equivalents. [PIIGS ETFs Gain Cash]

Investors now have another Australia ETF to choose from in the form of the SPDR MSCI Australia Quality Mix ETF (NYSEArca: QAUS). As is the case with QESP, the new Spain ETF, QAUS could be the beneficiary of some good timing as Australian equities, though richly valued, have been among the strongest performers in the developed world this year. [Australia ETFs Continue to Impress]

The SPDR MSCI Germany Quality Mix ETF (NYSEArca: QDEU) is the eighth Germany-specific ETF to list in the U.S. Top holdings in that ETF’s underlying index include BASF, Siemens (NYSE: SIE) and SAP (NYSE: SAP).