“As a refresher, it is generally a good idea to hold some quality in a portfolio. Since 1994 quality, measured by the MSCI U.S. Quality Index, has produced higher monthly average returns than the S&P 500. In addition, the relative performance of quality versus the S&P 500 tends to be highest when the VIX is rising,” according to BlackRock.
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Speaking of volatility, QUAL’s three-year standard deviation of 8.99% is slightly below that of traditional domestic equity benchmarks.
The ETF holds 124 stocks, over 41% of which hail from the technology and healthcare sectors. Consumer discretionary and financial services names combine for 26.63% of the fund’s weight.
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