State Street Global Advisors, the asset management arm of State Street, has launched three single-country advanced beta SPDR ETFs.
These ETFs aim to represent the performance of a combination of three factors, quality, value and low volatility, with the objective of giving investors improved risk-adjusted return potential when investing in single-country markets. The new ETFs add to the existing nine multi-factor SPDR MSCI Quality Mix ETFs that were launched in June 2014.
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The three new ETFs, which began trading on the NYSE Arca as of September 18, 2014, include:
- SPDR MSCI Mexico Quality Mix ETF (QMEX)
- SPDR MSCI South Korea Quality Mix ETF (QKOR)
- SPDR MSCI Taiwan Quality Mix ETF (QTWN)
"Our new SPDR MSCI Quality Mix ETFs provide investors with an opportunity to fine-tune their international exposure with a single-country portfolio that captures multiple investment themes," said James Ross, executive vice president and global head of SPDR Exchange Traded Funds at State Street Global Advisors. "Multi-factor advanced beta strategies combine factor tilts that can help achieve diversification by using factors that have shown negative or low correlation. These exposures are appealing to investors as they can behave differently in similar market environments in terms of risk and return."
Investors may look to each of the recently launched Quality Mix ETFs to add strategic elements to their core portfolio. The selection of exposures available range from international with the SPDR MSCI EAFE Quality Mix ETF (QEFA), which includes 22 markets in Europe, Australaisa and Far East countries, to emerging markets, with the SPDR MSCI Emerging Markets Quality Mix ETF (QEMM), which captures large- and mid-cap representation across 21 emerging markets countries and global with the SPDR MSCI World Quality Mix ETF (QWLD).
Additional country specific funds include Australia (QAUS), Canada (QCAN), Germany (QDEU), Japan (QJPN), Spain (QESP) and the United Kingdom (QGBR). The funds give investors opportunities to consider access to precise multi-factor investment across markets.
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By GlobalDataAdvanced beta, also known as alternative or smart beta, refers to a set of approaches that deviate from the traditional cap-weighted model and instead weight indices or securities based on alternative rules-based methodologies.
Designed to represent the performance of quality, value and low volatility factor strategies across global markets in a single composite index, the MSCI Quality Mix A-Series Indexes are an equal weighted combination of the MSCI Value Weighted, MSCI Minimum Volatility and MSCI Quality Indexes. The MSCI Minimum Volatility Index may be replaced with its corresponding MSCI Risk Weighted Index in the event that there is too much concentration or too few stocks in the index.
The three new SPDR MSCI Quality Mix ETFs feature an expense ratio of 0.40 percent.
