Top-Performing Stock ETFs of the Quarter

Stock exchange-traded funds, or equity ETFs, are often low-cost, tax-efficient instruments for investors to track popular indexes or leverage experienced manager choices to beat the market. The best ones serve as low-cost building blocks in a portfolio, and unlike open-end mutual funds, all ETFs are traded throughout the day on an exchange.

In the third quarter of 2024, the top-performing stock ETFs included large value funds Invesco S&P 500 High Dividend Low Volatility ETF SPHD and SPDR Portfolio S&P 500 High Dividend ETF SPYD. Data in this article is sourced from Morningstar Direct.

Screening for the Best-Performing ETFs

To find the quarter’s best-performing stock ETFs, we screened the Morningstar US Equity category for names that trade within the United States. We excluded exchange-traded notes and ETFs with less than $100 million in total assets.

Within our list, two funds fell into the small blend category, where the average name rose 8.43% in the third quarter.

The 10 Best-Performing ETFs for Q3 2024

1. Invesco S&P 500 High Dividend Low Volatility ETF SPHD
2. SPDR Portfolio S&P 500 High Dividend ETF SPYD
3. Invesco S&P SmallCap 600 Revenue ETF RWJ
4. SPDR SSGA US Small Cap Low Volatility Index ETF SMLV
5. Federated Hermes US Strategic Dividend ETF FDV
6. ALPS Sector Dividend Dogs ETF SDOG
7. SRH US Quality ETF SRHQ
8. Invesco S&P Ultra Dividend Revenue ETF RDIV
9. ProShares Russell 2000 Dividend Growers ETF SMDV
10. VictoryShares US Large Cap High Dividend Volatility Weighted ETF CDL

Metrics for the Best-Performing Stock ETFs

Invesco S&P 500 High Dividend Low Volatility ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.3%
• Morningstar Category: Large Value

The $3.5 billion Invesco S&P 500 High Dividend Low Volatility ETF was the best-performing ETF in the quarter, with a 14.79% return. The passively managed Invesco ETF beat the 8.04% gain on the average fund in Morningstar’s large value category for the quarter. Over the last 12 months, the Invesco S&P 500 High Dividend Low Volatility ETF has returned 34.34%, outperforming the 27.14% gain on the average fund in its category, leaving the ETF in the 6th percentile.

The Invesco S&P 500 High Dividend Low Volatility ETF has a Morningstar Medalist Rating of Neutral. It was launched in October 2012.

SPDR Portfolio S&P 500 High Dividend ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.07%
• Morningstar Category: Large Value

The second-best-performing ETF in the quarter was the $6.8 billion SPDR Portfolio S&P 500 High Dividend ETF. The passively managed State Street ETF returned 14.63%, outperforming the average large value fund, which gained 8.04%. Looking back over the last 12 months, the SPDR Portfolio S&P 500 High Dividend ETF has returned 36.19%, outperforming the 27.14% return on the average fund in its category, leaving the ETF in the 3rd percentile.

The Bronze-rated SPDR Portfolio S&P 500 High Dividend ETF was launched in October 2015.

Invesco S&P SmallCap 600 Revenue ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 0.39%
• Morningstar Category: Small Value

The $2 billion Invesco S&P SmallCap 600 Revenue ETF ranked third for the quarter, returning 14.42%. The Invesco ETF, which is passively managed, topped the 8.14% average return on funds in the small value category for the third quarter. Over the last 12 months, the Invesco ETF has returned 27.38%, ahead of the 22.72% gain on the average fund in its category, leaving the ETF in the 16th percentile.

The Invesco S&P SmallCap 600 Revenue ETF, launched in February 2008, has a Morningstar Medalist Rating of Silver.

SPDR SSGA US Small Cap Low Volatility Index ETF

• Morningstar Rating: 4 stars
• Expense Ratio: 0.12%
• Morningstar Category: Small Blend

With a 13.63% return, the $193 million SPDR SSGA US Small Cap Low Volatility Index ETF ranked fourth in the quarter. The passively managed State Street ETF outperformed the 8.43% return on the average small blend fund. Over the last 12 months, the fund has gained 29.09%, ahead of the 25.04% return on funds in its category, placing it in the 17th percentile.

The SPDR SSGA US Small Cap Low Volatility Index ETF has a Silver Morningstar Medalist Rating. It was launched in February 2013.

Federated Hermes US Strategic Dividend ETF

• Morningstar Rating: N/A
• Expense Ratio: 0.5%
• Morningstar Category: Large Value

The fifth-best-performing ETF was the $160 million Federated Hermes US Strategic Dividend ETF, which gained 13.03% in the quarter. This actively managed Federated Hermes ETF beat the 8.04% average return on funds in the large value category. Over the past year, the Federated Hermes US Strategic Dividend ETF rose 29.16%, outperforming the 27.14% return on the average fund in its category and placing it in the 32nd percentile.

The Federated Hermes US Strategic Dividend ETF, launched in November 2022, has a Morningstar Medalist Rating of Silver.

ALPS Sector Dividend Dogs ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.36%
• Morningstar Category: Large Value

The $1.2 billion ALPS Sector Dividend Dogs ETF was the sixth-best-performing US ETF in the quarter, with a 12.66% return. The return on the passively managed ALPS ETF topped the 8.04% gain on the average fund in Morningstar’s large value category. Over the last 12 months, the ALPS Sector Dividend Dogs ETF has returned 30.64%, outperforming the 27.14% return on the average fund in its category, leaving the ETF in the 20th percentile.

The ALPS Sector Dividend Dogs ETF has a Negative Morningstar Medalist Rating, meaning our analysts expect it to be one of the worst performers within its category and think it is unlikely to deliver positive returns after fees.

SRH US Quality ETF

• Morningstar Rating: N/A
• Expense Ratio: 0.35%
• Morningstar Category: Mid-Cap Blend

The seventh-best-performing ETF in the quarter was the $149 million SRH US Quality ETF. The passively managed SRH Funds ETF returned 12.58%, outperforming the average mid-cap blend fund, which gained 8.34%. Looking back over the last 12 months, the SRH US Quality ETF has returned 32.31%, outperforming the 27.66% return on the average fund in its category, leaving the ETF in the 15th percentile.

The SRH US Quality ETF has a Morningstar Medalist Rating of Silver. It was launched in October 2022.

Invesco S&P Ultra Dividend Revenue ETF

• Morningstar Rating: 2 stars
• Expense Ratio: 0.39%
• Morningstar Category: Large Value

The $816 million Invesco S&P Ultra Dividend Revenue ETF ranked eighth for the quarter, returning 12.41%. The Invesco ETF, which is passively managed, topped the 8.04% average gain on funds in the large value category. Over the last 12 months, the Invesco ETF has returned 39.68%, ahead of the 27.14% return on the average fund in its category, leaving it in the 1st percentile.

The Neutral-rated Invesco S&P Ultra Dividend Revenue ETF was launched in September 2013.

ProShares Russell 2000 Dividend Growers ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.4%
• Morningstar Category: Small Blend

With a 12.06% gain, the $710 million ProShares Russell 2000 Dividend Growers ETF ranked ninth in the third quarter. The passively managed ProShares ETF outperformed the 8.43% return on the average small blend fund. Over the last 12 months, the fund has returned 26.09%, ahead of the 25.04% return on funds in its category, placing it in the 43rd percentile.

The ProShares Russell 2000 Dividend Growers ETF, launched in February 2015, has a Morningstar Medalist Rating of Negative.

VictoryShares US Large Cap High Dividend Volatility Weighted ETF

• Morningstar Rating: 3 stars
• Expense Ratio: 0.35%
• Morningstar Category: Large Value

The tenth-best-performing ETF was the $356 million VictoryShares US Large Cap High Dividend Volatility Weighted ETF, which gained 11.86% in the third quarter. The passively managed Victory Capital ETF beat the 8.04% average return on funds in the large value category. Over the past year, the VictoryShares US Large Cap High Dividend Volatility Weighted ETF rose 29.73%, outperforming the 27.14% return on the average fund in its category and placing it in the 26th percentile.

The VictoryShares US Large Cap High Dividend Volatility Weighted ETF has a Morningstar Medalist Rating of Neutral. It was launched in July 2015.

What Are ETFs?

Exchange-traded funds are investments that trade throughout the day on stock exchanges, much like individual stocks. They differ from traditional mutual funds—known as open-end funds—which can only be bought or sold at a single price each day. Historically, ETFs have tracked indexes, but in recent years, more have been actively managed. ETFs cover a range of asset classes, including stocks, bonds, commodities, and most recently cryptocurrency.

ETFs offer investors an efficient way to gain exposure to the markets, often with low fees and ease of buying and selling. They also generally offer higher tax efficiency than open-end funds.

The Best Stock ETFs: More Ideas to Consider

Investors who would like to find more of the top-performing or cheapest ETFs can do the following:

• Read Morningstar’s guide to ETF investing.
• Explore the best ETFs and how they fit into your portfolio.
• Review the full list of US Stock ETFs. Funds with at least 70% of assets in US stocks are placed within the US equity categories.
• Use the Morningstar Investor Screener tool to find the best ETFs according to your specific criteria. You can search for funds based on their fees, Morningstar Medalist Ratings, manager tenures, and more.
• Use Morningstar Investor to build a watchlist of the best ETFs and easily follow their valuations, ratings, and fees.
• Watch our ETF video series, hosted by Daniel Sotiroff, for ideas to consider.