ACWI vs QQQ
iShares MSCI ACWI ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. ACWI offers more diversification with 2,280 holdings.
Side-by-Side Comparison
| Metric | ACWI | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.32% | 0.18% | |
| AUM | $32.1B | $455.8B | |
| Dividend Yield | 1.43% | 0.41% | |
| Holdings | 2,280 | 108 | |
| YTD Return | +14.77% | +19.68% | |
| 1Y Return | +23.52% | +26.75% | |
| 3Y Return (annualized) | +20.73% | +26.25% | |
| 5Y Return (annualized) | +11.13% | +15.39% | |
| Volatility (annualized) | 16.6% | 30.6% | |
| Max Drawdown | -56.3% | -83.0% | |
| Fund Family | iShares by BlackRock (US) | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Mar 26, 2008 | Mar 10, 1999 |
ACWI vs QQQ Performance
iShares MSCI ACWI ETF (ACWI) is a ETF from iShares by BlackRock (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year ACWI returned +23.52% while QQQ returned +26.75%. Year to date, ACWI is up 14.77% versus a gain of 19.68% for QQQ.
Over three years, ACWI compounded at +20.73% per year against +26.25% for QQQ; over five years the annualized figures are +11.13% and +15.39% respectively. Across the full 18-year window we track, QQQ has the edge at +13.15% annualized vs +7.12%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 16.6% for ACWI. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -56.3% for ACWI and -83.0% for QQQ. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.88. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
ACWI charges 0.32% per year while QQQ charges 0.18%. On a $10,000 position that is $32 vs $18 annually, a gap of $14 per year that compounds over a long holding period. On income, ACWI currently yields 1.43% against 0.41% for QQQ.
Holdings Overlap
ACWI and QQQ share 92 holdings out of 1326 unique holdings combined, representing a 34.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, ACWI or QQQ?
ACWI has an expense ratio of 0.32% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $14 per year of difference.
Which performed better, ACWI or QQQ?
Over the past year ACWI returned +23.52% vs +26.75% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (18 years), ACWI annualized +7.12% vs +13.15% for QQQ. Past performance does not guarantee future results.
Which is riskier, ACWI or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 16.6% for ACWI. Worst drawdown: ACWI -56.3% vs QQQ -83.0%.
Should I hold both ACWI and QQQ?
ACWI and QQQ have a monthly-return correlation of 0.88, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between ACWI and QQQ?
ACWI and QQQ share 92 common holdings with a 34.0% weight overlap. Combined, they hold 1326 unique securities.
Which pays a higher dividend, ACWI or QQQ?
ACWI yields 1.43% while QQQ yields 0.41%, so ACWI currently pays the higher dividend yield.
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