U.S. Quality Factor Gains 14.3%, Its Biggest Month Since 1957
Photo: TokenPost
The U.S. quality-minus-junk stock factor rose 14.3% in July 2026, its biggest monthly gain in records since July 1957, reversing a record stretch of lower-quality stocks outperforming. That record stretch ran from November 2023 through June 2026, when the long-quality, short-junk portfolio lost 36%, its worst performance in a 69-year record. Lower-quality stocks' outperformance was fueled in part by enthusiasm for artificial intelligence. The factor ranks U.S.-listed companies on profitability, growth and financial safety. It takes long positions in the highest-scoring 30% of stocks and short positions in the lowest-scoring 30%, with market-value weighting and monthly rebalancing.
Source: TokenPost
