Is It Time to Consider Invesco QQQ Trust for Your Investment Portfolio?
Invesco QQQ Trust Performance
- Outperformance of S&P 500: The Invesco QQQ Trust (NASDAQ: QQQ) has significantly outperformed the S&P 500 over the past decade, achieving a rally of 482% and a total return of 528%. In contrast, the S&P 500 advanced 245% with a total return of 312% during the same period.
- Challenges in Beating the S&P 500: Historically, it has been difficult for hedge funds to outperform the S&P 500, with 89.5% of them underperforming over the last 10 years, as indicated by SPIVA Scorecards.
Investment Strategy and Index Composition
- Focus on High-Growth Stocks: The QQQ tracks the Nasdaq-100 index, which includes the 100 largest non-financial stocks on the Nasdaq stock market, emphasizing higher-growth tech companies like Nvidia, Microsoft, Amazon, Apple, and Broadcom.
- Volatility and Risk: While the Nasdaq-100 is more focused on growth, it is also more volatile due to the absence of slower-growth, safer stocks that typically stabilize during market downturns.
Cost Structure and Alternatives
- Expense Ratios: QQQ has an expense ratio of 0.20%, higher than the Vanguard S&P 500 ETF's 0.03% and the average 0.14% for passively managed ETFs. This higher fee is attributed to its structure as a unit investment trust (UIT), which limits certain investment strategies.
- Emergence of QQQM: Invesco launched the Invesco NASDAQ 100 ETF (NASDAQ: QQQM) in 2020, which has a lower expense ratio of 0.15%. The company is also working to convert QQQ to an open-ended fund to reduce its fees further.
Investment Recommendations
- Consideration of Alternatives: While QQQ remains a reliable long-term investment, analysts suggest that QQQM may be a smarter choice due to its lower fees and similar index tracking.
- Stock Advisor Insights: The Motley Fool's Stock Advisor has identified 10 stocks that are currently recommended for investment, which do not include Invesco QQQ Trust. Historical performance of their recommendations shows significant returns, with examples like Netflix and Nvidia yielding returns of $659,823 and $1,113,120, respectively, from a $1,000 investment.
Conclusion
- Long-Term Outlook: Despite its higher fees, QQQ could continue to outperform the S&P 500 due to its focus on high-growth sectors like cloud computing, AI, and semiconductors. Investors should weigh the potential for higher returns against the associated risks and costs.
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Analyst Views on QQQM
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Netflix Allegedly Aiming to Broaden NFL Games Coverage
Netflix's Christmas Day Game Package: Netflix is in the final year of its three-year Christmas Day game package, for which it paid approximately $75 million per game.
Interest from Competitors: Google’s YouTube and several broadcast partners, including Amazon, have expressed interest in adding additional games to their offerings, particularly for the NFL.
Expansion Plans: Netflix is reportedly looking to expand its current two-game package to four games for the National Football League, including new games like the Thanksgiving Eve game.
Subscription Price Changes: Netflix recently raised its Standard subscription prices in the U.S., with the new prices set at $8.99 for the plan with ads and $19.99 for the standard plan, although no specific date for these changes was mentioned for existing subscribers.
Despite Rising Tech Earnings, This ETF Remains Lagging Behind
Tech Sector Performance: Despite struggles in the tech sector this year, companies in the Magnificent Seven have shown strong earnings growth and record-setting revenue, with projections indicating continued confidence from management teams across various industries.
Investor Sentiment: Investors have been rotating out of tech since Q4 2025, yet analysts are raising their earnings forecasts for 2026, with many companies exceeding Wall Street's expectations in Q1.
Stock Price Trends: Overall, the tech sector is down nearly 5% year-to-date, with individual companies like Microsoft experiencing significant declines, while some sectors, such as consumer staples, have performed better.
Market Opportunities: The ETF tracking the tech sector presents a substantial opportunity for investors, especially as tech stocks are expected to rebound, despite current underperformance and concerns about valuations.
Invesco NASDAQ 100 ETF announces quarterly payout of $0.3230
Invesco NASDAQ 100 ETF (QQQM) Dividend: QQQM has declared a dividend of $0.3230, with a 30-Day SEC Yield of 0.50% as of December 21, payable on December 26 for shareholders of record on December 22.
Investment Strategy: The author plans to shift from stock picking to investing in QQQM and TQQQ to outperform the market by 2026, favoring QQQM for its cost-effective leverage.
Market Volatility: Investors are advised to prepare for increased market volatility due to the upcoming quadruple witching day, which typically sees heightened trading activity.
Economic Concerns: Apollo has raised concerns about stagflation as the Federal Reserve navigates the challenges of balancing inflation and job market risks for 2026.
What Has Been the Performance of Costco (COST) Stock for Investors?
Recent Performance: A $10,000 investment in Costco six months ago would now be worth $8,769, reflecting a total return of negative 12.3%, while the stock has outperformed the S&P 500 and NASDAQ-100 over the past five years.
Market Sentiment: Despite recent underperformance, bullish investors view the current dip as a buying opportunity, citing Costco's strong financial results and increased sales due to consumer demand for cost-saving goods.
Valuation Concerns: Critics point out that Costco's stock trades at high valuation ratios, with a current multiple of 50, raising concerns about its sustainability in a challenging economic environment marked by rising operating costs.
Investment Recommendations: The Motley Fool's Stock Advisor has identified ten stocks as better investment opportunities than Costco at this time, highlighting the potential for significant returns from those recommendations.
ETF Inflow Update: QQQM, AMAT, LIN, TXN
52-Week Range of QQQM: QQQM's share price has a 52-week low of $165.72 and a high of $262.23, with the last trade recorded at $256.68.
Understanding ETFs: Exchange-traded funds (ETFs) function like stocks, where investors buy and sell "units" that can be created or destroyed based on demand.
Monitoring ETF Flows: Weekly monitoring of shares outstanding helps identify ETFs with significant inflows (new units created) or outflows (old units destroyed), impacting the underlying holdings.
Author's Views: The opinions expressed in the article are those of the author and do not necessarily represent the views of Nasdaq, Inc.
Nvidia's Strong Earnings Boost Tech Sector: Key ETFs Rise Amid AI Excitement
Nvidia's Strong Earnings Report: Nvidia reported a revenue of $57 billion for the quarter ending in October, a 62% year-over-year increase, primarily driven by AI and data center demand, and provided a Q4 revenue guidance of $65 billion, surpassing analyst expectations.
Impact on ETFs: Nvidia's impressive earnings led to a significant rally in ETFs heavily invested in the company, including semiconductor and tech-focused funds, with many experiencing sharp increases in their net asset values.
Global Market Reaction: The positive results from Nvidia boosted semiconductor stocks globally, with companies in Europe and Asia also seeing gains, indicating a synchronized strength in the semiconductor sector.
Valuation Concerns: Despite the strong performance, analysts caution about the interconnectedness and potential fragility of the AI ecosystem, suggesting that while Nvidia remains robust, some valuations in the sector appear stretched.
Netflix Allegedly Aiming to Broaden NFL Games Coverage
Netflix's Christmas Day Game Package: Netflix is in the final year of its three-year Christmas Day game package, for which it paid approximately $75 million per game.
Interest from Competitors: Google’s YouTube and several broadcast partners, including Amazon, have expressed interest in adding additional games to their offerings, particularly for the NFL.
Expansion Plans: Netflix is reportedly looking to expand its current two-game package to four games for the National Football League, including new games like the Thanksgiving Eve game.
Subscription Price Changes: Netflix recently raised its Standard subscription prices in the U.S., with the new prices set at $8.99 for the plan with ads and $19.99 for the standard plan, although no specific date for these changes was mentioned for existing subscribers.
Despite Rising Tech Earnings, This ETF Remains Lagging Behind
Tech Sector Performance: Despite struggles in the tech sector this year, companies in the Magnificent Seven have shown strong earnings growth and record-setting revenue, with projections indicating continued confidence from management teams across various industries.
Investor Sentiment: Investors have been rotating out of tech since Q4 2025, yet analysts are raising their earnings forecasts for 2026, with many companies exceeding Wall Street's expectations in Q1.
Stock Price Trends: Overall, the tech sector is down nearly 5% year-to-date, with individual companies like Microsoft experiencing significant declines, while some sectors, such as consumer staples, have performed better.
Market Opportunities: The ETF tracking the tech sector presents a substantial opportunity for investors, especially as tech stocks are expected to rebound, despite current underperformance and concerns about valuations.
Invesco NASDAQ 100 ETF announces quarterly payout of $0.3230
Invesco NASDAQ 100 ETF (QQQM) Dividend: QQQM has declared a dividend of $0.3230, with a 30-Day SEC Yield of 0.50% as of December 21, payable on December 26 for shareholders of record on December 22.
Investment Strategy: The author plans to shift from stock picking to investing in QQQM and TQQQ to outperform the market by 2026, favoring QQQM for its cost-effective leverage.
Market Volatility: Investors are advised to prepare for increased market volatility due to the upcoming quadruple witching day, which typically sees heightened trading activity.
Economic Concerns: Apollo has raised concerns about stagflation as the Federal Reserve navigates the challenges of balancing inflation and job market risks for 2026.
What Has Been the Performance of Costco (COST) Stock for Investors?
Recent Performance: A $10,000 investment in Costco six months ago would now be worth $8,769, reflecting a total return of negative 12.3%, while the stock has outperformed the S&P 500 and NASDAQ-100 over the past five years.
Market Sentiment: Despite recent underperformance, bullish investors view the current dip as a buying opportunity, citing Costco's strong financial results and increased sales due to consumer demand for cost-saving goods.
Valuation Concerns: Critics point out that Costco's stock trades at high valuation ratios, with a current multiple of 50, raising concerns about its sustainability in a challenging economic environment marked by rising operating costs.
Investment Recommendations: The Motley Fool's Stock Advisor has identified ten stocks as better investment opportunities than Costco at this time, highlighting the potential for significant returns from those recommendations.
ETF Inflow Update: QQQM, AMAT, LIN, TXN
52-Week Range of QQQM: QQQM's share price has a 52-week low of $165.72 and a high of $262.23, with the last trade recorded at $256.68.
Understanding ETFs: Exchange-traded funds (ETFs) function like stocks, where investors buy and sell "units" that can be created or destroyed based on demand.
Monitoring ETF Flows: Weekly monitoring of shares outstanding helps identify ETFs with significant inflows (new units created) or outflows (old units destroyed), impacting the underlying holdings.
Author's Views: The opinions expressed in the article are those of the author and do not necessarily represent the views of Nasdaq, Inc.
Nvidia's Strong Earnings Boost Tech Sector: Key ETFs Rise Amid AI Excitement
Nvidia's Strong Earnings Report: Nvidia reported a revenue of $57 billion for the quarter ending in October, a 62% year-over-year increase, primarily driven by AI and data center demand, and provided a Q4 revenue guidance of $65 billion, surpassing analyst expectations.
Impact on ETFs: Nvidia's impressive earnings led to a significant rally in ETFs heavily invested in the company, including semiconductor and tech-focused funds, with many experiencing sharp increases in their net asset values.
Global Market Reaction: The positive results from Nvidia boosted semiconductor stocks globally, with companies in Europe and Asia also seeing gains, indicating a synchronized strength in the semiconductor sector.
Valuation Concerns: Despite the strong performance, analysts caution about the interconnectedness and potential fragility of the AI ecosystem, suggesting that while Nvidia remains robust, some valuations in the sector appear stretched.
