BlackRock
- Investors are pouring money into profitable companies with strong balance sheets and low debt, says BlackRock.
- Quality stocks will benefit investors as the US economy heads toward the peak of economic growth this year, the firm says.
- Quality ETFs have taken in more than $3 billion after outflows of $2.4 billion in Q1.
- See more stories on Insider’s business page.
Investors are increasingly putting more money into so-called quality stocks as they prepare to meet what’s likely to be the height of economic growth this year, according to BlackRock.
So far in the third quarter, $2 billion has poured into quality exchange-traded funds after they absorbed $1.3 billion in the second quarter, the firm said in a note Tuesday. Those mark reversals from outflows of $2.4 billion in the first quarter, which was the first quarter of net outflows for quality since 2015.
BlackRock defines quality stocks as those of companies with strong balance sheets, profitable earnings, and low debt. That group was shunned by investors earlier in 2021 as they chased inexpensive value shares and cyclical stocks that are closely linked with prospects of economic growth, with the economy in recovery mode from the devastating COVID-19 pandemic.
“While investments that benefit from broad-based growth, such as cyclical and value sectors, still have room to run, we think it is time to add…
