Advisors Favor U.S. Quality-Growth ETFs

Advisors are shifting to U.S. exchange-traded funds that combine quality screens with a growth tilt. The $18 billion Invesco S&P 500 Quality ETF (SPHQ) remains a core holding, while the VictoryShares Free Cash Flow Growth ETF (GFLW) and the WisdomTree U.S. Quality Growth Fund (QGRW) have drawn assets and net inflows in 2026.

SPHQ uses a rules-based approach that selects large-cap stocks for higher return on equity and lower financial leverage. As of April 30, SPHQ’s sector allocation was 29% Information Technology, 25% Industrials and 15% Consumer Staples. The fund has been used as a quality core in multi-asset portfolios.

GFLW, launched in December 2024, tracks an index of 100 large-cap growth companies screened for positive free cash flow trends and return on investment. The fund weights holdings using a mix of free cash flow and momentum. Its sector footprint differs from standard growth benchmarks: Information Technology accounted for about 44% of the fund, Industrials about 18% and Materials about 5%. GFLW’s top holdings include Comfort Systems and Newmont alongside Broadcom and NVIDIA.

QGRW, launched in 2022, targets 100 large-cap growth firms with stronger quality characteristics relative to peers. The fund had roughly $2.5 billion in assets. Its sector mix was about 52% Information Technology and 17% Communication Services. QGRW’s top 10 positions, including NVIDIA, Alphabet and Apple, represented roughly 61% of the portfolio. QGRW rose about 13% year-to-date in 2026 and recorded approximately $155 million in net inflows so far this year.

Overlap among the three ETFs is limited. VettaFi analysis shows GFLW and QGRW share about 29% of their equity members, and overlap with SPHQ is lower. Differences in index rules and weighting methods produce materially different sector exposures and individual-stock concentrations: QGRW’s top-10 concentration is higher than GFLW’s and SPHQ’s.

VettaFi is the index provider for GFLW and receives an index licensing fee.