Validea’s ETF Factor Report looks at hundreds of US Equity ETFs through the lens of the major investing factors. We look at each ETFs exposure to a variety of factors and metrics to help investors better understand what they are getting when they buy an ETF, and what they are paying for it.
This week, we take a look at the Alpha Architect Quantitative Value ETF (QVAL)
General Information
Factor Exposure
QVAL invests in mid and large-cap companies, which is reflected in its middle of the road size exposure. It is a focused value ETF, as reflected in its value exposure of 97 using our system (indicating its portfolio is cheaper than 97% of other ETFs using a composite of value factors). From a value metric standpoint, its holdings indicate that it focuses on value metrics other than the Price/Book.
What is unique about QVAL relative to other value ETFs is it exposure to quality. Many value ETFs will invest in the cheapest stocks without focusing on quality. QVAL’s above average quality score indicates a significant focus on quality in addition to value. It is also interesting to note that its holdings currently score very highly on momentum as well.
Factor Exposure Chart
Sector Exposure
While many ETFs seek to maintain similar sector exposures to their benchmark, QVAL uses a less constrained approach, as evidenced by its current significant overweight of Energy and underweight of Technology
More Information
For more detailed information on QVAL or to research additional ETFs, see our ETF Factor Report.
