QQQ vs QQQM - Which Nasdaq ETF Is Better? (Head-To-Head ETF Comparison!)

QQQ vs QQQM - Which Nasdaq ETF Is Better? (Head-To-Head ETF Comparison!). In this comparison video I will talk about QQQ vs QQQM.
So, the main difference between them is drawdowns.
Since its inception, QQQ has experienced a maximum drawdown of -82.98%, whereas its QQQM sister ETF has encountered a slightly lower drawdown of about -35.05%. Drawdowns are crucial for measuring losses from any peak point along stock prices. Despite the huge differences in their historical drawdowns, the two ETFs have maintained a narrow gap of about 0.20% in the better part of their last seven months.
Therefore, QQQM takes the win in this category as it presents with a lower drawdown since its inception.
Volatility
Volatilities help in assessing ETF’s price fluctuation with time. Currently, QQQ presents with a volatility value of about 5.19%, whereas its QQQM counterpart has a volatility of about 5.22%. Usually, larger volatilities indicate possibilities of price fluctuations by huge values, hence increased investment risks. In this instant, though, the 0.03% disparity in the ETF's volatilities merely causes a significant difference in their price fluctuation, hence almost similar price fluctuation-time graphs.
Although the win is almost insignificant, QQQ bags it in this category.
Expense ratio
As much as Invesco manages both funds in reference to NASDAQ-100 as the underlying index, the ETFs charge expense ratios independently of one another. Currently, QQQ investors have to pay an expense ratio cost equivalent to 0.20% of their total assets. On the other hand, QQQM investors reimburse for services offered to them with a slightly lower expense ratio of 0.15%. This 0.05% difference in expense ratios may escalate to huge cost differences, especially if the investments are massive.
Therefore, QQQM outsmarts QQQ in this category due to its lower expense ratios.
But do they have similarities?
Yes. QQQ and QQQM are similar in that some of their risk-adjusted metrics are identical. For instance, each of the ETFs currently presents a Sharpe ratio of 2.99, resulting in the overlapping of their Sharpe ratio-time graphs. Also, identical stock price fluctuations result in identical return-based performance.
To sum up, which is better - QQQ or QQQM?
I began by investing in QQQ before switching to QQQM due to the latter's low expense ratios. Funny enough, almost all the remaining provisions, such as volatilities and recent drawdowns, are almost identical, that a novice investor may fail to realize their slight difference. Either way, the subtle difference in the ETFs' expense ratios informs my choice to settle for QQQM as the ultimate winner.
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