No. of Recommendations: 1
"The $48 billion iShares MSCI USA Quality Factor (ticker: QUAL) and Invesco’s $15 billion S&P 500 Quality (SPHQ) specialize in what the investment industry has dubbed quality companies."
The charts of SPY, QUAL, and SPHQ look like they zig and zag in sync with each other,
just at lower amplitudes ( year to date ).
YTD price: SPY +14.5%, QUAL +10.5%, SPHQ 4.7%, QQQ 22%
Top10 Holding %:
SPY: 39.3%, QUAL: 40.4%, SPHQ: 40%
SPY and QQQ have 9 of the same Top10 holdings, only difference is
SPY holds BRK/B and QQQ holds NFLX. The amount ( % ) of Top10 is different,
39.5% for SPY, 53.7% for QQQ.
The other 9 same holdings are:
NVDA,AAPL,MSFT,AMZN,AVGO,GOOGL,GOOG,META,TSLA.
So holding both SPY and QQQ is very much holding the same thing, not much
diversification there.
QUAL and SPHQ are definitely diversified away from tech in Top10 holdings, which
explain their lagging in YTD gains.
I own both SPY and QQQ in my accounts. I was/am aware that there isn't much
meaningful diversification. I have trimmed them, and have had lower performance
as a result. But I accept that.
Hard to drum up any enthusiasm for pulling money out of fixed and into stocks.
The dividend etf SCHD has had price gain of about 1% YTD, plus a yield of approximately 3.7%, so a bit better than Treasuries but with all the risk of
owning stocks.
