JQUA vs SFLO

JQUAAJPMorgan U.S. Quality Factor ETF

SFLOCVictoryShares Small Cap Free Cash Flow ETF

In short

JQUA Quality investing without the quality price tag. JQUA screens U.S. companies for profitability and strong balance-sheet traits, and charges 0.12%, the lowest fee in the quality-factor group we track.

SFLO Small caps are famous for companies that lose money. SFLO screens that universe for free cash flow and growth, then holds roughly 200 names, and it pays out monthly.

Stated mandate

JQUA JQUA is designed to provide domestic equity exposure focused on companies with strong quality and profitability characteristics, using a rules-based approach intended to enhance returns.

SFLO The Fund seeks to track, before fees and expenses, the Victory U.S. Small Cap Free Cash Flow Index. It normally emphasizes U.S. small-cap equity securities selected through a rules-based free-cash-flow and growth methodology.

Why people hold it

• JQUA 0.12% a year, against a roughly 0.29% median for quality-factor funds, and it undercuts the bigger badges QUAL and FQAL at 0.15%.
• About 300 U.S. names selected on quality and profitability: a broad core-shaped sleeve, not a concentrated wager on a dozen balance sheets.
• Live since 2017 and now a multi-billion-dollar, actively traded fund, so it has both a real track record and daily two-way flow.
• One of the stronger implementations in its peer group: it stays close to the JP Morgan US Quality Factor Index it follows while keeping costs at the bottom of the group.

• SFLO The whole point: a rules-based screen that ranks U.S. small caps on free cash flow and growth, so the cash-burners that populate the broad small-cap benchmarks get filtered out.
• Roughly 200 stocks. Concentrated enough that the cash-flow screen actually shows up in the portfolio, broad enough that no single name runs the show.
• Pays monthly, which is rare in small-cap equity funds where quarterly is the norm.
• It tracks a published index rather than a stock-picker's hunches, so the rules are the same every rebalance.

Worth knowing

• JQUA A quality screen is a tilt, not a shield. Owning profitable companies means owning less of everything else, and that gap cuts both ways.
• Trades actively, though it is not the most heavily traded fund on the quality-factor shelf, which matters more for large orders than small ones.
• Distributions land quarterly and fall out of what the screen owns. Income is a byproduct here, not the mandate.

• SFLO The screen costs you: 0.56% a year, more than double the typical small-cap ETF, and many times what plain trackers like VB (0.03%), SCHA (0.03%) and IWM (0.19%) charge.
• Launched in December 2023, so the strategy has yet to be tested across a full market cycle.
• Trading is moderate rather than heavy, so spreads can be wider than the household-name small-cap funds, especially around the open and close.

Full JQUA profile⁠

Full SFLO profile⁠