Is IVV or QQQ a Better Choice for Investors? How These Popular ETFs Compare on Risk and Returns

The iShares Core S&P 500 ETF (NYSEMKT:IVV) stands retired for its little fees, broader assemblage coverage, and higher yield, portion the Invesco QQQ Trust, Series 1 (NASDAQ:QQQ) emphasizes tech-heavy maturation and caller outperformance.

Both funds fertile among the largest and astir liquid ETFs successful the U.S. IVV targets the S&P 500, providing vulnerability to 500 starring U.S. companies crossed assorted industries, portion QQQ tracks the NASDAQ-100, focusing connected exertion and maturation names. Here’s however they comparison connected cost, performance, risk, and portfolio makeup.

Beta measures terms volatility comparative to the S&P 500. The 1-yr instrumentality represents full instrumentality implicit the trailing 12 months.

IVV is much affordable with a little disbursal ratio than QQQ. It besides pays retired a higher dividend yield, which whitethorn entreaty to income-focused investors.

QQQ leans heavy into exertion (55%), connection services (17%), and user cyclicals (13%), with apical positions successful Nvidia, Apple, and Microsoft. This tilt results successful higher maturation imaginable but besides greater volatility and deeper drawdowns, particularly during marketplace corrections. QQQ holds conscionable implicit 100 names, providing little assemblage diversification than IVV.

IVV tracks the S&P 500, holding 503 stocks crossed each large sectors, with the largest allocations to exertion (34%), fiscal services (14%), and connection services (10%). Its apical holdings lucifer QQQ’s, but IVV’s portfolio is much diversified and little concentrated successful tech. With implicit 25 years of history, IVV has established itself arsenic a halfway holding for wide U.S. equity exposure.

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The superior quality betwixt IVV and QQQ comes down to strategy.

IVV is simply a wide marketplace money that tracks the S&P 500 and aims to replicate the index's performance. QQQ, connected the different hand, is simply a maturation money that's designed to gain above-average returns implicit time.