Flows can tell investors quite a bit about trends in the market and which ETFs might be on the rise. In some years, disruptive tech has thrived, where in others, income funds have stood out.
As 2025 approaches a close, quality ETF funds may be the category standing out, poised to benefit from rate cuts. One such fund, QGRO, has seen its AUM start to accelerate at a time when it may play a helpful role for investors.
See more: Quality Growth ETF QGRO Crosses $2 Billion AUM Amid New Interest
The American Century U.S. Quality Growth ETF (QGRO ), charges a 29 basis point (bps) fee for its approach. The fund tracks the American Century U.S. Quality Growth index, seeking U.S. firms with higher growth potential and strong fundamentals.
The index screens firms for a few key factors. Specifically, it measures companies for quality, growth, and income via metrics like sales, profitability, cash flow, and return on assets. Within that approach, the fund looks to combine so-called “high growth” stocks with stable growth companies that meet the index’s standards.
That has helped QGRO cross that $2 billion AUM threshold recently via more than $600 million in YTD net inflows per ETF Database data. That comes as the fund has also returned 14.8% YTD and 4% over the last month. Those returns outperformed both the fund’s ETF Database Category and Factset Segment averages in that time.
With one rate cut already in the books, QGRO could continue to perform. The strategy’s quality firms could be prepared to take advantage of rate cuts compared to other firms. Firms with strong cash flows and other fundamentals can potentially beat out other growth companies. What’s more, should there be “multiple” rate cuts instead of just this week’s 25 bps drop, such quality companies could outperform. For those looking at their equities options, QGRO and its rising AUM could intrigue.
VettaFi LLC (“VettaFi”) is the index provider for QGRO for which it receives an index licensing fee. However, QGRO is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of QGRO.
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