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Build On a Strong Earnings Season With These 3 ETFs

Author: Nathan Reiff. Article Published: 6/12/2026.

Despite numerous reasons investors might expect otherwise, 2026 appears to be off to an excellent start across much of the market. As shown by strong earnings growth that often tops analyst expectations, solid revenue gains, and continued margin expansion, the AI-driven market boom has remained resilient.

While not every segment of the market has flourished, the rally extends beyond information technology. Financial stocks, for example, have also performed well overall. For investors, that broad strength may create an opportunity to benefit through diversified exchange-traded funds (ETFs). Ideally, these investments can help capture market-wide growth while reducing exposure to risks tied to any single stock. One fund focused on overall momentum, one built around price-to-earnings (P/E) ratios, and one emphasizing momentum quality and consistency may be a good place to start.

A Momentum-Focused Fund With Market-Beating Returns

The iShares MSCI USA Momentum Factor ETF (BATS: MTUM) is one of the low-cost factor-based ETFs that have gained significant popularity in recent years. This fund targets a group of large-cap U.S. equities with a recent history of strong share price momentum.

Its underlying index helps ensure diversification across sectors, while sector-level weighting keeps the portfolio from becoming too concentrated.

The result is a fund with about half of its portfolio in technology stocks, with none of its nearly 130 holdings accounting for more than 6.5% of assets. The fund is well established, with close to $26 billion in assets under management and a healthy one-month average trading volume of around 1.5 million shares.

In terms of performance, the momentum strategy continues to deliver: MTUM has returned around 25% year-to-date (YTD) and 35% over the last 12 months. A modest dividend yield of 0.7% adds a little extra appeal. Overall, MTUM is a strong offering at a relatively low fee of 0.15% per year.

Unique CAPE-Based Value Fund With a Dividend Add-On

Economist Robert Shiller's CAPE ratio remains a widely followed valuation metric, and the Shiller CAPE U.S. Equities ETF (NYSEARCA: CAPE) translates that approach into a diversified fund. CAPE seeks to focus on large-cap U.S. equities from the four cheapest sectors, as determined by the CAPE ratio, while also using momentum as a secondary screen to help avoid possible value traps.

As of April 30, 2026, CAPE held information technology stocks, real estate firms, health care names, and consumer discretionary companies. The fund is rebalanced monthly to keep its positioning aligned with current market trends. The strategy is unique, but results have been mixed recently: CAPE is trading roughly flat YTD. That helps illustrate an important point: even when a sector appears undervalued, it does not guarantee that the stocks in that sector will quickly generate returns.

For investors, CAPE may be most appealing as a buy-and-hold ETF. That is partly due to its relatively modest asset base of just over a quarter of a billion dollars and its similarly small trading volume. At the same time, the fund's expense ratio is fairly high at 0.65%, though that is offset by a 1.3% dividend yield.

Quality of Momentum Is Key for This Specialized Active Fund

The Alpha Architect U.S. Quantitative Momentum ETF (NASDAQ: QMOM) is another momentum-based fund. In this case, QMOM factors in one-year returns and, more specifically, a history of small, continuous daily price gains rather than a smaller number of sharp spikes. The fund also focuses on smaller stocks, on the assumption that these companies receive less analyst coverage and may therefore present more mispricing opportunities.

QMOM is actively managed, but its expense ratio of 0.28% would not necessarily suggest that. Altogether, the ETF holds just over 50 different U.S. equity positions, all of which are roughly equally weighted, with no single name representing more than 2.5% of the portfolio. Its largest holdings include Dell Technologies Inc. (NYSE: DELL) and TD SYNNEX Corp. (NYSE: SNX), although the fund does not rely entirely on technology names.

QMOM's approach has generally been successful: the fund has returned close to 17% YTD and offers an appealing dividend yield of about 1.2%. While it is not especially well known, its asset base is approaching half a billion dollars. This fund may therefore appeal to investors seeking a momentum play a little off the beaten path—one that may be especially responsive to strong, sustained earnings performance among companies.