American Century US Quality Growth ETF

QGRO

Market cap $2.21B

Quality views can sometimes prove a key differentiator for ETFs and mutual funds. By adding that lens, funds can separate the wheat from the chaff and bring some strongest securities to the fore.

Key Takeaways With the U.S. equity market highly concentrated and representing a smaller share of global GDP, advisors are seeking non-U.S. growth opportunities. Funds like the American Century Quality Diversified International ETF (QINT) are capturing significant assets as investors target more attractive overseas valuations.

Designed to provide broad exposure to the Style Box - All Cap Growth category of the market, the American Century U.S. Quality Growth ETF (QGRO) is a smart beta exchange traded fund launched on 09/10/2018.

Advisors know that their clients often want to have tier cake and eat it, too. Investors want their growth exposures, but they also want strategies that can prove their worth even in periods of uncertainty.

Uncertainty is evergreen when it comes to investing. Some years, however, it's a bigger factor than others, with 2026 already defined by geopolitical and policy twists and turns.

American Century U.S. Quality Growth ETF offers exposure to highly profitable companies with growth characteristics. Since the index change in May 2023, QGRO has beaten the market proxied with IVV, yet keeping pace with vehicles like IWF, SCHG, QQQ, and QGRW was beyond its capabilities. Regarding factors, the QGRO portfolio is nicely positioned, offering a few advantages over SCHG and IWF in terms of valuation, forward EPS growth, and momentum.

Markets have been on the move in recent weeks, and so too have asset managers. ETF managers have plenty of flexibility when it comes to adjusting the holdings in their funds, and the managers of growth ETF QGRO are no exception.

The American Century U.S. Quality Growth ETF (QGRO) was launched on 09/10/2018, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - All Cap Growth category of the market.

American Century U.S. Quality Growth ETF offers a 'quality' growth approach but falls short compared to iShares Russell 1000 Growth ETF. QGRO provides greater diversification and sector exposure than IWF, yet underperforms on risk-adjusted returns and overall performance. A higher expense ratio, low liquidity, and high portfolio turnover make QGRO less appealing as a standalone investment versus IWF.

On this week's episode, Todd Rosenbluth, head of research at VettaFi, provided an in-depth look at the rapidly expanding indexing business and its role in driving innovation across the ETF landscape.