Is State Street SPDR MSCI EAFE StrategicFactors ETF (QEFA) a Strong ETF Right Now?
A smart beta exchange traded fund, the State Street SPDR MSCI EAFE StrategicFactors ETF (QEFA) debuted on 06/04/2014, and offers broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by State Street Investment Management, QEFA has amassed assets over $1.03 billion, making it one of the average sized ETFs in the Broad Developed World ETFs. Before fees and expenses, QEFA seeks to match the performance of the MSCI EAFE Factor Mix A-Series Index.
The MSCI EAFE Factor Mix A-Series Index captures large and mid-cap representation across 22 developed market Europe, Australasia, and Far East countries and aims to represent the performance of value, low volatility, and quality factor strategies.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.30%.
It has a 12-month trailing dividend yield of 3.00%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Taking into account individual holdings, Novartis Ag Reg (NOVN) accounts for about 2.36% of the fund's total assets, followed by Asml Holding Nv (ASML) and Astrazeneca Plc (AZN).
Its top 10 holdings account for approximately 15.89% of QEFA's total assets under management.
Performance and Risk
The ETF has added about 4.31% so far this year and is up roughly 34.92% in the last one year (as of 04/08/2026). In the past 52-week period, it has traded between $75.44 and $99.76
QEFA has a beta of 0.71 and standard deviation of 13.02% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 672 holdings, it effectively diversifies company-specific risk .
Alternatives
State Street SPDR MSCI EAFE StrategicFactors ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
iShares MSCI EAFE ETF (EFA) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA) tracks MSCI EAFE Investable Market Index. iShares MSCI EAFE ETF has $72.25 billion in assets, iShares Core MSCI EAFE ETF has $172.06 billion. EFA has an expense ratio of 0.32% and IEFA changes 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs
Bottom Line
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State Street SPDR MSCI EAFE StrategicFactors ETF (QEFA): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).
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