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BMO MSCI All Country World High Quality Index ETF (ZGQ)
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BMO MSCI Europe High Quality Hedged to CAD Index ETF (ZEQ)
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BMO MSCI USA High Quality Index ETF (ZUQ)
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iShares MSCI USA Quality Factor ETF (QUAL)
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Invesco S&P 500 Quality ETF (SPHQ)
Q: The rise in stock prices of a few mega-caps (Apple, Facebook, Amazon, etc.) has distorted the concept of broad diversification through index investing (S&P 500). While the index rises, many index constituents have performed poorly.
Some ETF providers have created funds that hold a subset of the components of existing indices. Inclusion is based on their concept of company "quality". Presumably this eliminates poor performers and results in a "better" fund.
Examples are: ZUQ, SPHQ, QUAL, ZGQ, ZEQ.
Please comment on this idea of "quality" subsets of existing indexes. Do you consider this to be a useful investing strategy? Would you consider the examples listed to be preferable investments compared to the broader indices?
Thank you.
IslandJohn
Some ETF providers have created funds that hold a subset of the components of existing indices. Inclusion is based on their concept of company "quality". Presumably this eliminates poor performers and results in a "better" fund.
Examples are: ZUQ, SPHQ, QUAL, ZGQ, ZEQ.
Please comment on this idea of "quality" subsets of existing indexes. Do you consider this to be a useful investing strategy? Would you consider the examples listed to be preferable investments compared to the broader indices?
Thank you.
IslandJohn
