BetaShares Australian Quality ETF (AQLT) — Review & Analysis

AQLT is a factor-tilted alternative to broad-market Australian equity ETFs, with $1.2 billion in assets as at May 2026 — about 0.3% of the entire $358 billion Australian ETF market. Betashares launched AQLT in April 2022 as the Australian counterpart to their successful QLTY global quality ETF. The fund tracks the Solactive Australia Quality Select Index, holding approximately 40 ASX-listed companies screened for three quality metrics: high return on equity, low debt-to-equity, and stable year-over-year earnings growth. The management fee is 0.35% per annum — higher than passive VAS (0.07%) or A200 (0.04%), but reasonable for factor-tilted exposure.

To compare AQLT side-by-side with every other ETF on the ASX, see the full ETF directory.

AQLT's quality screens systematically underweight banks and miners (which typically score lower on stable earnings) and overweight healthcare, technology, consumer staples and industrials. As at May 2026, the top 10 holdings typically include CSL, Macquarie, Goodman Group, James Hardie, REA Group, Cochlear, Wesfarmers, Sonic Healthcare, Carsales and ResMed — a very different mix from broad-market VAS (which is dominated by CBA, BHP and the big-4 banks). The strategy effectively gives Australian investors the structural sector exposures they miss in VAS. Over the 3 years to May 2026, AQLT returned +52.9% total return — well ahead of VAS (+34.6%) and A200 (+35.2%) over the same window.

AQLT pays distributions quarterly (late September, December, March and June) with significant franking credits. As at May 2026, the trailing 12-month cash distribution yield runs around 2.5-3.0%, distributions are typically about 80% franked, lifting the grossed-up yield to around 3.5-4.0% for an Australian resident taxpayer. The cash yield is lower than VAS (~4%) because AQLT systematically underweights bank dividends — the trade-off is higher capital growth from the quality tilt. AQLT will lag VAS in periods when banks and miners rally (like the 12 months to May 2026); it will outperform when those sectors lag.

AQLT is a defensible alternative to broad-market Australian equity ETFs if you specifically want quality-factor exposure without the banks-and-miners concentration of VAS. At 0.35% MER it's 5x the cost of VAS, so the quality factor needs to deliver excess returns to justify the fee. So far, it has — AQLT has outperformed VAS by ~18 percentage points over 3 years. A $10,000 investment in AQLT at its April 2022 launch (with all distributions reinvested) would be worth roughly $16,000 as at May 2026 — an annualised return of about 12.5% per year over the 4-year period.