QQQ enjoys 25th birthday and outperforming the S&P 500 - ETF Express (2024)

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QQQ enjoys 25th birthday and outperforming the S&P 500 - ETF Express (4)

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This year sees the 25th anniversary of Invesco’s QQQ, the USD240 billion ETF – the fifth largest ETF in the universe – that tracks the Nasdaq 100, which has enjoyed out-performing the S&P 500 and achieving the position of number one in performance over 10, 15 and 20 years in the Lipper Large Cap Growth category as of December 31, 2023.

Ryan McCormack, Senior Factor & Core Equity Strategist, ETFs & Indexed Strategies, at Invesco says that it is an important milestone for the product. “It’s an exciting time and last year we had stellar outperformance. 2023’s story boils down to QQQ’s exposure, and weightings to mega-cap growth companies helped drive performance.”

2022 was challenging year for investors but early in 2023 the fund was perceived to be a good buying opportunity which rolled into the “abrupt entrance of AI”, he says. Current performance is 6.8 per cent and the fund has enjoyed USD6 billion of inflows year to date already.

Behind the ETF, the team looks at patents filed which, McCormack says, “gives us an interesting window on where companies are investing their time and resources. The team also looks at overlap between QQQ and thematic indices. For example, the overlap between QQQ and the Nasdaq Big Data & AI Index is 60 per cent, along with significant overlap among themes like robotics, future mobility, semiconductors and the metaverse.

McCormack says that the patents are important, as it is an indication that companies are trying to develop intellectual property. Recently filed patents spanned across speech recognition, 3D graphics, automated cars and Natural Language Processing (NLP). “In the observed one-year period as of 11/30/2023, Nasdaq 100 Index companies filed over 40 per cent of global patents relating to NLP,” he says. “Looking at patents gives us a roadmap to what the future may look like.”

In the AI race, Nvidia is a clear-cut winner with the increased demand and attention but there are other companies such as those found in QQQ’s siblings in the innovation suite.

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QQQ enjoys 25th birthday and outperforming the S&P 500 - ETF Express (11)

QQQ enjoys 25th birthday and outperforming the S&P 500 - ETF Express (12)

© 2022 ETF Express

QQQ enjoys 25th birthday and outperforming the S&P 500 - ETF Express (2024)

FAQs

Has QQQ outperformed the S&P 500? ›

Invesco QQQ — the ETF that tracks the Nasdaq-100 index — has beaten the S&P 500 eight out of the last 10 years as of March 31, 2024. Source: Morningstar Inc.

How is QQQ compared to S&P 500? ›

QQQ - Volatility Comparison. The current volatility for SPDR S&P 500 ETF (SPY) is 2.28%, while Invesco QQQ (QQQ) has a volatility of 3.11%. This indicates that SPY experiences smaller price fluctuations and is considered to be less risky than QQQ based on this measure.

What is the average return of QQQ in the last 30 years? ›

In the last 30 Years, the Invesco QQQ Trust (QQQ) ETF obtained a 14.40% compound annual return, with a 24.00% standard deviation.

What does QQQ stand for? ›

Triple quadrupole mass spectrometer (QqQ), a mass spectrometer comprising three consecutive quadrupoles. QQQ is the ticker symbol for Invesco QQQ, an exchange-traded fund (ETF) based on the Nasdaq-100 Index created by Invesco PowerShares. A Morse code signal for unknown attacker, used in conjunction with SOS.

What ETF has outperformed the S&P 500? ›

1. Vanguard Growth ETF. The Vanguard Growth ETF is up 37.3% over the past year and an even better 59.1% since the start of 2023. One look at its holdings, and it's easy to see why.

What is the downside to investing in QQQ? ›

The QQQ ETF offers buy-and-hold investors low expenses and long-term growth potential with enough diversification to avoid the risks of betting on one company. On the downside, long-term investors in QQQ must deal with sector risk, possible overvaluation, and the absence of small caps.

What is the best ETF for S&P 500? ›

  • SPY, VOO and IVV are among the most popular S&P 500 ETFs.
  • These three S&P 500 ETFs are quite similar, but may sometimes diverge in terms of costs or daily returns.
  • Investors generally only need one S&P 500 ETF.
May 31, 2024

What is the largest ETF holder of QQQ? ›

Largest ETFs: Top 100 ETFs By Assets
SymbolNameAUM
QQQInvesco QQQ Trust Series I$286,659,000.00
VUGVanguard Growth ETF$133,694,000.00
VEAVanguard FTSE Developed Markets ETF$131,247,000.00
IEFAiShares Core MSCI EAFE ETF$115,941,000.00
96 more rows

Should I invest in ETF or S&P 500? ›

While dividend ETFs can offer stable income, their growth potential is generally lower over the long run. That said, dividend ETFs may outperform the S&P 500 during particular time frames, such as during a recession or a period of easing interest rates.

Can QQQ be held long-term? ›

QQQ is perhaps best-suited as a long-term investment for those who want broad exposure to the Nasdaq-100 Index. TQQQ is built for short-holding periods and is best suited for day traders.

Where will QQQ be in 5 years? ›

According to the latest long-term forecast, Invesco QQQ price will hit $500 by the middle of 2024 and then $600 by the end of 2025. Invesco QQQ will rise to $700 within the year of 2026, $800 in 2028, $900 in 2029, $1000 in 2030, $1100 in 2031, $1200 in 2033 and $1300 in 2035.

What is the 10 year rate of return for QQQ? ›

Index returns do not represent Fund returns. Source: Bloomberg L.P., QQQ NAV 10-year performance reflected 18.58% growth versus 12.93% by the S&P 500, as of March 31, 2024.

Is QQQ better than VOO? ›

Average Return

In the past year, QQQ returned a total of 32.90%, which is significantly higher than VOO's 26.58% return. Over the past 10 years, QQQ has had annualized average returns of 19.01% , compared to 12.95% for VOO. These numbers are adjusted for stock splits and include dividends.

Is QQQ overvalued? ›

QQQ Put Spread Appears to be Overvalued at $0.94

Based on historical stock price behavior, this spread for QQQ has a theoretical 79% success rate.

Is QQQ a good investment in 2024? ›

QQQ Q1 Performance. Invesco QQQ ETF (QQQ) picked up where 2023 left off with strong performance in Q1 2024. The fund advanced by 8.66% for the quarter (on an NAV basis, 12/31/2023 – 03/31/2024) but underperformed the S&P 500's total return of 10.55%.

Has Nasdaq outperformed S&P? ›

The Nasdaq-100® and S&P 500 stand as two of the most prominent equity indexes in the United States. With its considerable emphasis on innovative sectors like Technology, Consumer Discretionary, and Health Care, the Nasdaq-100 has consistently outperformed the S&P 500 over the past 16 years (12/31/2007 – 3/28/2024).

What will QQQ be worth in 5 years? ›

Invesco QQQ stock price stood at $485.21

According to the latest long-term forecast, Invesco QQQ price will hit $500 by the middle of 2024 and then $600 by the end of 2025. Invesco QQQ will rise to $700 within the year of 2026, $800 in 2028, $900 in 2029, $1000 in 2030, $1100 in 2031, $1200 in 2033 and $1300 in 2035.

Why QQQ is the best? ›

Key Points. The Invesco QQQ Trust is heavily weighted to the tech and consumer discretionary sectors. Historical returns have been very impressive, comfortably outpacing the broader S&P 500. The Invesco QQQ Trust is a low-cost and low-maintenance investment vehicle.

Is QQQ better than voo? ›

Average Return

In the past year, QQQ returned a total of 32.90%, which is significantly higher than VOO's 26.58% return. Over the past 10 years, QQQ has had annualized average returns of 19.01% , compared to 12.95% for VOO. These numbers are adjusted for stock splits and include dividends.

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