Quality Companies, Attractively Priced

History has shown that value investing has delivered strong risk-adjusted returns over time. Today, many investors choose low-cost cap-weighted index portfolios to gain exposure to this attractive segment. Yet there are some downsides to this approach:

  • Cyclicality—Value investing has historically moved in and out of favor, exposing investors to cyclical ups and downs1
  • Sector Concentrations—Cap-weighted value indexes can leave investors over-exposed to certain sectors, particularly those in decline1
  • Value Trap—Value indexes often include low-quality companies that are at risk of further deterioration1

Uncovering Value Throughout the Market Cycle

American Century® STOXX® U.S. Quality Value ETF (VALQ) seeks to dampen the cyclicality of value investing to pursue strong risk-adjusted returns throughout the market cycle. Our methodology seeks to identify quality companies at attractive valuations, complementing them with strong dividend-payers.

STOXX® is a registered trademark of STOXX Ltd.

Intelligent Beta* Methodology

Start with Broad Large-Cap Equity Universe

900 Largest U.S. Companies (STOXX® 900 Index)

Inclusion of the 900-largest U.S. stocks helps ensure broad diversification across large-cap equities

1. Apply Proprietary Quality Screens

Profitability; Earnings Quality; Management Quality; Earnings Revisions; Leverage

Helps eliminate low-quality companies that may deteriorate further

2. Select Stocks Based on Valuation and Income Scores

  • Seeks to identify the most attractively valued companies across sectors
  • Includes consistent dividend-payers to help mitigate risk when value falls out of favor

3. Construct Portfolio Based on Optimization Process

  • Strives to balance expected return of value stocks with downside protection of income stocks
  • Designed to ensure broad market exposure to help manage risk
  • Seeks to help protect against the cyclicality of value investing

4. Portfolio of Approximately 200-300 Stocks

By eliminating more than 75% of the U.S. large-cap market, VALQ offers the potential for equity market returns with less volatility

* Intelligent Beta refers to a set of investment strategies that emphasize the use of alternative index construction rules to traditional market capitalization-based indexes. Intelligent Beta emphasizes capturing investment factors or market inefficiencies in a rules-based and transparent way.

Why Consider VALQ? View Fund Details

Risk/Reward Profile

Investors pursuing a more attractive risk/reward profile by complementing or replacing a cap-weighted large value portfolio

Core Portfolio Component

Investors searching for a core portfolio component that offers exposure to U.S. large-cap stocks

Complement to Active Management

Investors seeking a complement to a more concentrated, actively managed value portfolio

Discover VALQ

Learn more about the VALQ fund characteristics and performance.

Fund Details

Share with Your Clients

Download our client-ready flyer to share with your clients.

VALQ Flyer

1 Source: Russell 1000® Value Index. Source: Factset.

Exchange Traded Funds (ETFs) are bought and sold through exchange trading at market price, not Net Asset Value (NAV), and are not individually redeemed from the fund. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns.

This fund is not actively managed and the portfolio managers do not attempt to take defensive positions under any market conditions, including declining markets. The portfolio managers also do not generally add or remove a security from the fund until such security is similarly added or removed from the underlying index. Therefore, the fund may hold an underperforming security or not hold an outperforming security until the underlying index reacts. This may result in underperformance compared to the market generally. In addition, there is no assurance that the underlying index will be determined, composed or calculated accurately. While the index provider provides descriptions of what the underlying index is designed to achieve, the index provider does not guarantee the quality, accuracy or completeness of data in respect of its indices, and does not guarantee that the underlying index will be in line with the described index methodology. Gains, losses or costs to the fund caused by errors in the underlying index may therefore be borne by the fund and its shareholders.

The STOXX® Index is the intellectual property (including registered trademarks) of STOXX Limited, Zurich, Switzerland ("STOXX"), Deutsche Börse Group or their licensors, which is used under license. The fund is neither sponsored nor promoted, distributed or in any other manner supported by STOXX, Deutsche Börse Group or their licensors, research partners or data providers and STOXX, Deutsche Börse Group and their licensors, research partners or data providers do not give any warranty, and exclude any liability (whether in negligence or otherwise) with respect thereto generally or specifically in relation to any errors, omissions or interruptions in the STOXX® Index or its data.

The Russell 1000® Index is a trademark/service mark of the Frank Russell Company. Russell® is trademark of the Frank Russell Company.

Exchange Traded Funds (ETFs): Foreside Fund Services, LLC - Distributor, not affiliated with American Century Investments Services, Inc.