Here are 2 'quality' ETFs that this expert is recommending right now

These ETFs could be quality options for investors in the current economic environment.

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Exchange traded funds (ETFs) continue to grow in popularity and it isn't hard to see why.

That's because ETFs allow you to invest easily in groups of shares that give you exposure to sectors, countries, indices, or even themes.

One theme that is popular with investors right now is the defensive theme. This is due to the global economic uncertainty that rising interest rates is causing.

In fact, Betashares' chief economist, David Bassanese, believes investors should consider adding defensive shares to their portfolio because of this. He commented:

This year has already presented many unexpected challenges for investors. Some, such as a potential US-led global recession, are already obvious and firmly in the sights of investors. Others – such as the recent spate of US bank failures – can catch investors off guard, remaining obscured until the very last moment. For investors who have positioned their portfolios appropriately, the impact might not be quite so severe

With that in mind, listed below are a couple of defensive ETFs that have recently been recommended by Bassanese as great options in the current environment. They are as follows:

Betashares Australian Quality ETF (ASX: AQLT)

The first ETF for investors to consider is the Betashares Australian Quality ETF. As you might have guessed from its name, this ETF provides investors with exposure to a group of high-quality ASX shares.

Betashares notes that the ETF's holdings are selected on 'quality' metrics of high return on equity, low leverage, and relative earnings stability. This currently includes companies such as CSL Limited (ASX: CSL) and Telstra Group Ltd (ASX: TLS).

Betashares Global Quality Leaders ETF (ASX: QLTY)

Another option is the Betashares Global Quality Leaders ETF. This is the international equivalent of the Betashares Australian Quality ETF, giving investors exposure to a portfolio of approximately 150 global companies (excluding Australia).

As with the other ETF, to be included in this one a company needs to rank highly on four key metrics. These are return on equity, debt-to-capital, cash flow generation ability, and earnings stability. The ETF includes giants such as Alphabet, Microsoft, and Nvidia.

Motley Fool contributor James Mickleboro has positions in CSL. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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