“Quality has historically outperformed other equity style factors in economic slowdowns, our analysis shows. One sector where we find these quality characteristics: health care. The sector also shows low sensitivity to global growth, which historically has provided resilience in late cycle,” according to BlackRock.

Technology is QUAL’s largest sector weight at 19.76%, but the fund devotes 15.56% to healthcare stocks making that group its second-largest sector allocation. Financial services and communication services combine for almost 24% of QUAL’s roster.

QUAL is up 2.58% to start 2019. Investors added $2.97 billion to QUAL last year.

For more information on the smart beta strategy, visit our smart beta category.

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