Ever picked an ETF because it returned 33% last year… only to see it crash when the hype faded? Or played it safe with a “stable” ETF, missing out on 28% gains? Yeah, that’s the struggle most investors face. The problem? Most people choose ETFs based only on past returns—and that’s why they underperform.
Today, we’re breaking down three completely different ETFs, and spoiler alert: the one with the highest return might actually be the worst choice for your money.
We’ve got:
1️⃣ MTUM – rides hot momentum stocks
2️⃣ QUA – focuses on high-quality, steady companies
3️⃣ IWM – packs nearly 2,000 small-cap stocks in one fund
But here’s the kicker: the best performer in 2024 could be the riskiest in 2026. Stick with me—by the end, you’ll know which strategy suits your risk tolerance and which ETF could wreck your portfolio if you choose wrong.
1️⃣ MTUM – iShares MSCI USA Momentum Factor ETF 🌊
Think of momentum investing like riding a wave. MTUM buys stocks that are already on the rise, betting that winners keep winning… at least for a while.
Performance? 🔥
YTD 2025: +25%
1-year: +28%
3-year annualized: +27%
2024: +33%
Top holdings include Broadcom, Meta, Netflix, Tesla, JP Morgan, Berkshire Hathaway, Walmart, and more. Tech dominates at ~42% of the fund, financials ~17%.
✅ Pros: Explosive growth potential
⚠️ Risks: High volatility; momentum can reverse fast
2️⃣ QUA – iShares MSCI USA Quality Factor ETF 🏆
Quality investing is the opposite of chasing trends. QUA focuses on companies with strong fundamentals, stable earnings, and solid balance sheets. Basically, the “honor roll students” of the stock market.
Performance:
YTD 2025: +10%
1-year: +10%
3-year annualized: +25%
5-year annualized: ~15%
2024: +22%
Top holdings: Nvidia, Apple, Microsoft, Visa, Mastercard, Eli Lilly, Meta, Alphabet, Netflix, TJX. Tech is 36%, but the fund is more diversified across sectors.
✅ Pros: Steady growth, consistent returns
⚠️ Risks: Lower explosive gains than momentum ETFs
3️⃣ IWM – iShares Russell 2000 ETF 🌱
IWM is all about small-cap stocks—nearly 2,000 of them! These are the smaller players in the US economy with massive growth potential.
Performance:
YTD 2025: +10%
1-year: +11%
3-year annualized: +15%
5-year annualized: +11%
2024: +11%
Sector spread is balanced: financials 17%, tech 17%, industrials 16%, healthcare 15%.
✅ Pros: Maximum diversification, small-cap growth exposure
⚠️ Risks: More sensitive to market swings
Side-by-Side Comparison 📊
| ETF | 2025 YTD | 1-Year | 3-Year | 2024 | Assets | Expense Ratio | Holdings | Risk Level |
|---|---|---|---|---|---|---|---|---|
| MTUM | +25% | +28% | +27% | +33% | $19.5B | 0.15% | 129 | High |
| QUA | +10% | +10% | +25% | +22% | $53B | 0.15% | 129 | Medium |
| IWM | +10% | +11% | +15% | +11% | $70B | 0.19% | ~2,000 | Medium-High |
Key takeaway:
MTUM = high risk, high reward 🌟
QUA = steady, quality growth 📈
IWM = diversified small-cap potential 🌱
There’s no universal winner. It all depends on your risk tolerance, goals, and timeline. You could even mix all three: 40% QUA for stability, 30% MTUM for growth, 30% IWM for small-cap exposure.
🔥 Final Thoughts
Past returns don’t guarantee future results. The best ETF is the one that fits your strategy and lets you sleep at night. Risk tolerance matters more than chasing hype.
So… which team are you? Team Momentum (MTUM), Team Quality (QUA), or Team Small Cap (IWM)? Drop your pick in the comments!
If you’re ready to start investing in these ETFs today, check out Moomoo—a super easy platform to buy ETFs and grow your money: 👉 Invest with Moomoo Now 💸
#InvestSmart #ETFs2026 #MoneyMoves #MoomooInvesting #FinancialFreedom #StockMarketTips #HighReturns2026
