ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About Us
    • Swag Store
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Core Strategies Channel
  2. VALQ is a Valid Idea for Current Market Environment
Core Strategies Channel
Share

VALQ is a Valid Idea for Current Market Environment

Tom LydonFeb 09, 2022
2022-02-09

Though not to extreme levels, at least not yet, volatility is making its presence felt in the early stages of 2022. However, some market observers argue that sticking with stocks is the proper course of action.

Fundamentals are sturdy, and some market participants believe that equities continue looking attractive relative to bonds. Those factors and more could bode well for select exchange traded funds, include the American Century STOXX U.S. Quality Value ETF (VALQ B).

“Individual and corporate finances are in solid shape,” says BlackRock. “Fourth-quarter earnings are coming in strong. Through January, 78% of the 172 S&P 500 firms reporting had delivered a positive earnings-per-share surprise. Recent market angst is all about rates and inflation.”

Adding to the case for VALQ is the solid start to 2022 by value stocks. That’s a sign that, at the very least, investors should consider balancing growth and value within their portfolios.

“We’d evaluate current allocations to ensure better balance between the two. The year started with a large rotation into value as the intrinsically longer-duration cash flows of growth companies were threatened by rising interest rates,” adds BlackRock. “Looking out, we see a new world order of higher rates and inflation ― at least relative to the low levels that reigned since the 2008 global financial crisis. This new paradigm should bode well for value and open up an opportunity for underallocations to be addressed.”

VALQ, which tracks the iSTOXX® American Century® USA Quality Value Index, offers investors a unique spin on value investing, as it’s not excessively allocated to the financial services and energy sectors — two staples of traditional value funds. Those sectors combine for just 7% of VALQ’s weight.

Rather, VALQ’s quality mandate leads it to a combined 37% weight to the technology and healthcare sectors, both of which are high quality groups and the latter of which is offering considerable value today.

“Quality stocks have been priced at a discount throughout the economic restart, particularly as investors favored riskier bets that paid off in the early phases of last year’s market upswing. We believe they are poised to rerate higher in the next stage of the cycle. In addition to attractive valuations, our research shows quality stocks have historically outperformed the broader market over the long term while enhancing portfolio resilience,” concludes BlackRock.

Bottom line: At a time when the market is signaling that quality is important, VALQ is a credible idea for investors to evaluate.

For more news, information, and strategy, visit the Core Strategies Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X