Here’s a quick overview comparing them to their underlying index. On the other hand, the US-listed Invesco QQQ ETF has been around for over two decades and is an extremely liquid ETF with over 100 Bn dollars of assets under management. So why bother investing overseas? Here is an analysis of two trackers of the Nasdaq 100 Index – one listed in India and the other in the US.Īlthough the India-listed Motilal Oswal Nasdaq 100 ETF (MOFN100) was launched in 2011, its AUM grew significantly only this year. Their resilience in the current pandemic has made Indian investors take notice and start diversifying their portfolio internationally.īut we’ve seen international investment opportunities available in India. The US markets have outperformed the Indian markets in the last decade. And none of the content written should be taken as financial advice.The interest in investing in the US stock market has surged in India. So you can’t go wrong with either ones.Īs always, remember that Past Performance is No Guarantee of Future Results. That said, both funds provided very high 10 years annualized returns. Although, this didn’t impact much on the performance when compared to QQQ. Secondly, the fund omitted other major tech companies like Google and Amazon. This is a rather huge concentration risk. However, I’m leaning towards QQQ on this.įirst of all, even though VGT consist of 360 companies, the top 2 holdings makes up ~40% of the total asset for VUG. Conclusionīoth funds perform rather similar. These are very good returns for funds that are passively managed. Source: and The 10 years annualized return for both funds sits at ~20%. The worst negative return happened in 2008, with VGT losing -42.81% vs QQQ’s -41.73%. These 2 ETFs have similar growth based on the chart above. VGT (Vanguard Information Technology ETF): $104,163 This is what you would have ended up with in Jan 2022, if you have invested $10,000 at the beginning of 2004. The time period was constrained by the available data for Vanguard Information Technology ETF (VGT). Using the Portfolio Visualizer to back test these 2 ETFs, we can then compare the portfolio growth between Feb 2004 – Jan 2022. Performance Of VGT Vs QQQ Portfolio Growth There are a total of 39 overlapping counters between VGT and QQQ. This means they do not fall under any the sub categories in VGT as seen below. Amazon is classified as Internet & Direct Marketing Retail and Google and Facebook are under Interactive Media & Services. QQQ does slightly better in this aspect that top 3 holdings makes up almost 30% of the fund.Īnother thing that I noticed with VGT is that companies such as Amazon, Facebook and Google are not included in the ETF. This is a concentration risk to note when you are buying into VGT. With VGT, the top 2 holdings makes up 40.64% of the fund! Which means if AAPL or MSFT has a poor performance, then it will affect VGT greatly. Source: and The top 10 holdings of both funds makes up more than half of the total asset. (AAPL)ġ.84% 60.45% of total asset 52.2% of total asset as of Source: Fund Composite VGT Vs QQQ Top 10 Fund Holdings VGT QQQ Apple Inc. QQQ, on the other hand, has 2%~ of the total fund allocated to international companies. VGT is a pure US play, as it invests only in US companies. This means that only top 100 largest market capitalization companies are included in the ETF. Invesco QQQ includes 100 of the largest domestic and international nonfinancial companies listed on the Nasdaq Stock Market based on market capitalization. They include companies that are between small to large market capitalization VGT (Information Technology ETF) is made up of companies that are in the technology software and service, technology hardware and equipment and semiconductor and semiconductor equipment manufacturers sectors. These ETFs are more suited for growth play rather than dividend play. Personally, I wouldn’t buy these ETFs for the yield as these are pretty low yield rates. VGT has a slightly higher dividend yield at 0.71% vs QQQ’s 0.58%. This means that for every $10,000 you invest, you are only paying $10 and $20 respectively each year in management expenses. Source: and VGT has a expense ratio of 0.10% compared to QQQ’s 0.20%. IT 25/50 Index Nasdaq-100 Index Style Passive Passive Inception Date Expense Ratio 0.10% 0.20% Number of Stocks 360 102 % of 10 largest holdings 60.45% 52.3% Dividend Yield 0.71% 0.58% AUM $51.1 B $179.892 B as of Last modified on February 23rd, 2022 An Overview Of VGT vs QQQ VGT QQQ Benchmark Index MSCI US Investable Market By: Suz Posted on: May 7th, 2021 test February 23rd, 2022
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