A Promising Quality Value ETF
This low-cost strategy carves an edge by targeting stocks with strong profitability and low valuations.
There are good reasons some stocks trade at higher valuations than others. Often differences in valuations reflect differing expectations of future cash flows, not necessarily differences in expected returns. Pairing valuations with a measure of future expected cash flows should more cleanly isolate differences in expected returns and improve performance. That’s what Avantis U.S. Equity ETF (AVUS) attempts to do.
This fund tilts toward stocks with attractive valuations and profitability, which gives it a good chance to beat the market over the long term. This low-cost strategy earns a Morningstar Analyst Rating of Bronze.
Alex Bryan does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.