iShares MSCI USA Quality Factor ETF (QUAL): Complete Beginner's Guide
iShares MSCI USA Quality Factor ETF (QUAL) is a quality factor ETF from BlackRock with an expense ratio of 0.15% and $40.0B in assets under management. Our Beginner Suitability Score: 9/10 (Great for Beginners). 5-year annualized return: 16.00%.
Last updated: April 2026
BlackRock • Quality Factor
Expense Ratio
0.15%
AUM
$40.0B
Dividend Yield
1.40%
Inception
2013
Beginner Score
9/10
What is iShares MSCI USA Quality Factor ETF?
QUAL targets U.S. large and mid-cap stocks that score highly on quality metrics like high return on equity, stable earnings growth, and low debt. It uses the MSCI USA Sector Neutral Quality Index to select fundamentally strong companies. For beginners, QUAL offers a smart way to tilt a portfolio toward financially healthy companies that tend to weather market downturns better.
QUAL is managed by BlackRock and has been available since 2013. With $40.0B in assets under management, it's a well-established fund with strong institutional backing. The fund charges an expense ratio of 0.15%, which means for every $10,000 you invest, you pay approximately $15 per year in management fees.
QUAL at a Glance — Key Metrics
| Expense Ratio | 0.15% |
| Total Holdings | 125 |
| P/E Ratio | 26.5 |
| Beta | 1.00 |
| Dividend Yield | 1.40% |
| AUM | $40.0B |
| Inception Year | 2013 |
| Issuer | BlackRock |
Top 10 Holdings in QUAL
QUAL holds 125 different securities. Here are the largest positions that make up the core of this fund:
| # | Company | Ticker | Weight |
|---|---|---|---|
| 1 | Apple Inc. | AAPL | 6.80% |
| 2 | NVIDIA Corp. | NVDA | 5.80% |
| 3 | Microsoft Corp. | MSFT | 5.50% |
| 4 | Meta Platforms Inc. | META | 4.80% |
| 5 | Visa Inc. | V | 3.20% |
| 6 | Mastercard Inc. | MA | 2.80% |
| 7 | Eli Lilly and Co. | LLY | 2.50% |
| 8 | Johnson & Johnson | JNJ | 2.20% |
| 9 | UnitedHealth Group Inc. | UNH | 2.00% |
| 10 | Home Depot Inc. | HD | 1.80% |
QUAL's top holding is Apple Inc. (AAPL) at 6.80%, followed by NVIDIA Corp. (NVDA) at 5.80% and Microsoft Corp. (MSFT) at 5.50%. The top 10 holdings account for 37.40% of the fund's 125 total positions.
View data table
| Rank | Company | Ticker | Weight |
|---|---|---|---|
| 1 | Apple Inc. | AAPL | 6.80% |
| 2 | NVIDIA Corp. | NVDA | 5.80% |
| 3 | Microsoft Corp. | MSFT | 5.50% |
| 4 | Meta Platforms Inc. | META | 4.80% |
| 5 | Visa Inc. | V | 3.20% |
| 6 | Mastercard Inc. | MA | 2.80% |
| 7 | Eli Lilly and Co. | LLY | 2.50% |
| 8 | Johnson & Johnson | JNJ | 2.20% |
| 9 | UnitedHealth Group Inc. | UNH | 2.00% |
| 10 | Home Depot Inc. | HD | 1.80% |
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QUAL Performance History
Here's how QUAL has performed over different time periods. Remember that past performance doesn't guarantee future results, but it gives you a sense of the fund's track record:
YTD
3.30%
1 Year
27.50%
3 Year
11.80%
5 Year
16.00%
10 Year
13.80%
QUAL has returned 16.00% annualized over 5 years and 13.80% over 10 years. YTD return is 3.30%.
View data table
| Period | Return |
|---|---|
| YTD | 3.30% |
| 1 Year | 27.50% |
| 3 Year | 11.80% |
| 5 Year | 16.00% |
| 10 Year | 13.80% |
Beginner Suitability Score: 9/10
Our proprietary Beginner Suitability Score evaluates ETFs based on five factors that matter most to new investors: fees, volatility, diversification, dividend history, and track record length.
QUAL scores 9/10 because it has very low fees, shows lower-than-average volatility, offers broad diversification across 125 holdings, and has been available since 2013, giving it a proven track record.
How to Buy QUAL — Step by Step
- Open a brokerage account — We recommend Fidelity, Charles Schwab, or Vanguard for ETF investing. All offer $0 commissions on ETF trades.
- Fund your account — Transfer money from your bank. You can start with as little as $1 if your broker offers fractional shares.
- Search for "QUAL" — Use the search bar in your brokerage platform to find iShares MSCI USA Quality Factor ETF.
- Place your order — Choose "Market Order" for simplicity or "Limit Order" if you want to set a specific price. Enter how many shares (or dollar amount) you want to buy.
- Set up automatic investing — Most brokers let you schedule recurring purchases (e.g., $100/month on the 1st). This is dollar cost averaging in action.
QUAL Sector Allocation
Here's how QUAL distributes its investments across different sectors of the economy:
QUAL's largest sector allocation is Information Technology at 29.5%, followed by Financials at 14.5% and Health Care at 13.5%.
View data table
| Sector | Weight |
|---|---|
| Information Technology | 29.5% |
| Financials | 14.5% |
| Health Care | 13.5% |
| Consumer Discretionary | 10.5% |
| Communication Services | 9.0% |
| Industrials | 8.5% |
| Consumer Staples | 6.0% |
| Energy | 3.5% |
| Materials | 2.5% |
| Utilities | 1.5% |
| Real Estate | 1.0% |
Dollar Cost Averaging Into QUAL
Here's what consistent monthly investing could look like over time, assuming an average annual return of 8% (approximate historical stock market average):
| Monthly | 10 Years | 20 Years | 30 Years |
|---|---|---|---|
| $100/mo | $18,417 | $59,295 | $150,030 |
| $250/mo | $46,041 | $148,237 | $375,074 |
| $500/mo | $92,083 | $296,474 | $750,148 |
*Projections assume 8% average annual return with monthly compounding. Actual returns will vary. Past performance doesn't guarantee future results.
Fee impact: With QUAL's expense ratio of 0.15%, a $10,000 investment would lose approximately $1,278 to fees over 20 years compared to a zero-fee investment. This is significant — consider whether the fund's strategy justifies these costs.
QUAL's expense ratio of 0.15% costs $1,278 on a $10,000 investment over 20 years (assuming 8% annual return). Without fees, the investment would grow to $46,610 instead of $45,332.
View data table
| Year | Without Fees | With Fees | Fee Cost |
|---|---|---|---|
| 0 | $10,000 | $10,000 | $0 |
| 5 | $14,693 | $14,592 | $101 |
| 10 | $21,589 | $21,291 | $298 |
| 15 | $31,722 | $31,067 | $655 |
| 20 | $46,610 | $45,332 | $1,278 |
Pros and Cons of QUAL
Pros
- ✓Targets financially healthy companies with strong profitability and low leverage
- ✓Sector-neutral approach avoids unintended bets on specific industries
- ✓Quality stocks tend to be more resilient during market sell-offs
- ✓Moderate expense ratio of 0.15% for a factor-based smart beta strategy
Cons
- ✗Quality premium may not always outperform the broad market in every period
- ✗Relatively concentrated with only about 125 holdings compared to broad index funds
- ✗Factor timing risk means quality stocks can underperform during speculative rallies
QUAL vs Similar ETFs
See how QUAL stacks up against similar funds:
Frequently Asked Questions
Is QUAL a good ETF for beginners?▾
QUAL has a Beginner Suitability Score of 9/10 on our scale. This makes it a strong choice for new investors due to its low fees and broad diversification.
What is the expense ratio of QUAL?▾
QUAL has an expense ratio of 0.15%. This means for every $10,000 you invest, you pay approximately $15 per year in fees. This is considered very low and cost-efficient.
How much money do I need to invest in QUAL?▾
You can invest in QUAL with as little as $1 through brokers that offer fractional shares (like Fidelity, Schwab, or Robinhood). There is no minimum investment required beyond the share price itself, which changes daily. Dollar cost averaging — investing a fixed amount regularly — is a popular strategy.
Does QUAL pay dividends?▾
Yes, QUAL pays dividends with a current yield of approximately 1.40%. Dividends are typically paid quarterly and can be reinvested automatically through most brokers.
What are the top holdings in QUAL?▾
The top holdings in QUAL include Apple Inc. (6.80%), NVIDIA Corp. (5.80%), Microsoft Corp. (5.50%), and more. The fund holds 125 total positions, providing broad diversification across many companies.
What sectors does QUAL invest in?▾
QUAL's largest sector allocations are Information Technology (29.50%), Financials (14.50%), Health Care (13.50%). This sector distribution shows a focus on information technology stocks.
How much do QUAL's fees cost over time?▾
With an expense ratio of 0.15%, a $10,000 investment in QUAL would lose approximately $1,278 to fees over 20 years (assuming 8% annual returns). Consider whether the fund's strategy justifies these costs.