QQQ vs. VOOG | Comparing Growth ETFs
The differences between QQQ vs. VOOG are minimal, but you should compare the ETFs to determine which is better for your portfolio.
Key Takeaways
QQQ and VOOG are both ETFs that track the performance of the U.S. stock market, but they have different compositions and strategies.
QQQ tracks the NASDAQ 100 Index, which includes 100 of the largest non-financial companies listed on the NASDAQ stock exchange, while VOOG tracks the S&P 500 Growth Index, which includes large-cap U.S. growth stocks.
Both funds have relatively low expense ratios and are good long-term investment options.
VOOG (Vanguard Growth) vs. QQQ (Nasdaq)
VOOG is an ETF that tracks the S&P 500® Growth Index, which represents large-cap growth companies in the US. The fund employs an indexing approach, which means it aims to replicate the index's performance by holding the same stocks in the same proportion as the index.
On the other hand, QQQ is an ETF that tracks the NASDAQ-100 Index®, representing the largest non-financial companies listed on the Nasdaq Stock Market. Similar to VOOG, QQQ also uses an indexing approach, adjusting the portfolio to reflect changes in the index.
As we dive deeper into the comparison, we will explore the similarities and differences between these two ETFs, including their performance history, expense ratios, and risk profiles, to help investors make informed decisions on which ETF to invest in.
VOOG Details
Expense Ratio: 0.10%
Dividend Yield: 1.23%
10yr Return: 13.62%
QQQ Details
Expense Ratio: 0.20%
Dividend Yield: 0.70%
10yr Return: 16.20%
VOOG vs. QQQ Historical Performance
Over the past ten years, QQQ has outperformed VOOG with a 10-year return of 16.20%, compared to VOOG's 10-year return of 13.62%. This may be partly because QQQ has exposure to a broader range of technology and non-financial companies, while VOOG focuses specifically on large-cap growth companies in the S&P 500 index.
VOOG vs. QQQ Differences
There are several differences between VOOG and QQQ ETFs that investors should be aware of when considering which one to invest in.
One key difference is that VOOG tracks the S&P 500 Growth Index, which includes large-cap growth companies in the United States, while QQQ tracks the NASDAQ-100 Index, which includes the largest non-financial companies listed on the Nasdaq Stock Market. This means that VOOG provides exposure to growth companies within the S&P 500 index, while QQQ has a broader range of technology and non-financial companies.
VOOG has a higher dividend yield of 1.23% compared to QQQ's yield of 0.70%. This may be attractive to investors looking for income-generating investments.
QQQ vs. VOOG Holdings
The top five holdings of QQQ and VOOG share some similarities, but there are also some important differences that investors should be aware of when comparing the two ETFs.
Tesla is a notable difference between QQQ and VOOG, as it is the fifth largest holding in QQQ but not in VOOG. Tesla is a leading electric vehicle company that has seen explosive growth in recent years and has been a significant contributor to the performance of QQQ.
Investors should note, however, that Tesla's high volatility and lack of consistent profitability may also introduce additional risk to the ETF.
Ultimately, the specific weightings of the top five holdings can have a significant impact on the overall performance of an ETF, but investors should also consider the other holdings and overall diversification of each fund when making investment decisions.
VOOG Holdings
QQQ Holdings
VOOG vs. QQQ | Which is Best for You?
When deciding between VOOG and QQQ, investors should consider several factors, including their investment goals, risk tolerance, and the composition of their existing investment portfolio.
Comparing the two ETFs, VOOG is focused on large-cap growth companies in the S&P 500 Growth Index, while QQQ tracks the Nasdaq 100 Index, which includes a mix of large-cap technology and non-technology companies. As discussed previously, the specific weightings of the top five holdings also differ between the two ETFs.
Both VOOG and QQQ have a similar level of risk, as they are both focused on large-cap companies. However, investors should know that individual stocks in these ETFs may be more volatile than the overall market. Investors with a lower risk tolerance may want to consider a more diversified investment strategy that includes exposure to a broader range of stocks.
