JQUA vs XSHQ

JQUAAJPMorgan U.S. Quality Factor ETF

XSHQBInvesco S&P SmallCap Quality 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.

XSHQ Most quality ETFs shop the S&P 500. XSHQ works the small-cap aisle: start with an index that already requires positive earnings, then keep the roughly 120 names scoring best on profits, accruals and leverage.

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.

XSHQ The Fund seeks to track, before fees and expenses, the price and yield performance of the S&P SmallCap 600 Quality Index.

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.

• XSHQ Quality is a formula, not a vibe: names ranked on return on equity, accruals ratio and financial leverage, weighted by score times market cap, reset each June and December.invesco.comspglobal.com
• The starting pool is already picky: S&P 600 membership requires positive earnings in the latest quarter and across the trailing four, so chronic money-losers never reach the screen.sec.gov
• Live since 2017, and no other fund in its quality-factor peer group tracks this index. It is the small-cap specialist in a lineup built around blue chips.
• Holdings line up closely with what the label promises, and the fund sits in the upper half of its quality-factor peer group. It pays quarterly.

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.

• XSHQ At 0.29% it runs about double the big large-cap quality funds (JQUA 0.12%, QUAL 0.15%), though that is right at the median for the wider quality group.
• Trades thinly next to the large-cap quality names, so spreads can widen at the open and close.
• Small caps swing harder than blue chips, and the screen narrows to about 120 names, so one company's stumble carries more weight.

Full JQUA profile⁠

Full XSHQ profile⁠