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This ETF Outperforms the S&P 500—Even in a Shaky Market

While most investors panic over losses, one ETF quietly thrives. Its secret? A disciplined mix of growth and value that defies market downturns.

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The image shows a graph on a white background with text that reads "S&P 500 Index Approved by...
The image shows a graph on a white background with text that reads "S&P 500 Index Approved by Month". The graph displays the index's performance over a period of time, with the x-axis representing the months and the y-axis indicating the index. The graph shows a steady increase in the index over the course of the month, indicating that the index has been steadily increasing over the past few months.

This ETF Outperforms the S&P 500—Even in a Shaky Market

Market uncertainty has weighed on the S&P 500 this year, with losses of around 2.7% so far. Rising tensions with Iran, higher fuel costs, and climbing unemployment have added to investor concerns. Yet some exchange-traded funds (ETFs) continue to deliver strong returns, offering potential opportunities for those looking beyond short-term swings.

One standout is the iShares MSCI USA Quality GARP ETF, which follows a strategy of selecting growth stocks at reasonable prices. Over the past five years, it has outperformed major indices by a wide margin.

The iShares MSCI USA Quality GARP ETF tracks the MSCI USA Quality GARP Index. This index focuses on large- and mid-cap US stocks that meet strict value and quality criteria. While specific holdings for 2023 remain undisclosed, the fund's approach has consistently delivered results.

Over the last 12 months, the ETF returned 32%, well ahead of the S&P 500 and Russell 1000, both at roughly 21.5%. Its five-year average annual return stands at 16%, compared to 11.5% for the S&P 500 and 10.7% for the Russell 1000. Despite broader market struggles—including fears of an overvalued stock market—this ETF has maintained its edge.

Analysts suggest that investors should look past short-term volatility. A longer-term perspective could reveal stronger opportunities, particularly in funds like this one that blend growth potential with disciplined valuation.

The GARP ETF's performance highlights its resilience in a challenging market. With returns consistently beating major benchmarks, it remains an option for those seeking growth without excessive risk. For now, the fund's strategy continues to attract attention as broader indices face pressure from economic and geopolitical headwinds.

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