AFMC vs QQQ
First Trust Active Factor Mid Cap ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. AFMC delivered stronger 1-year returns. AFMC offers more diversification with 266 holdings.
Side-by-Side Comparison
| Metric | AFMC | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.68% | 0.18% | |
| AUM | $205M | $496.3B | |
| Dividend Yield | 0.70% | 0.44% | |
| Holdings | 266 | 108 | |
| YTD Return | +19.17% | +17.30% | |
| 1Y Return | +27.23% | +24.93% | |
| 3Y Return (annualized) | +20.40% | +26.19% | |
| 5Y Return (annualized) | +11.59% | +15.34% | |
| Volatility (annualized) | 20.4% | 30.6% | |
| Max Drawdown | -42.1% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Dec 4, 2019 | Mar 10, 1999 |
AFMC vs QQQ Performance
First Trust Active Factor Mid Cap ETF (AFMC) is a ETF from First Trust Portfolios (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year AFMC returned +27.23% while QQQ returned +24.93%. Year to date, AFMC is up 19.17% versus a gain of 17.30% for QQQ.
Over three years, AFMC compounded at +20.40% per year against +26.19% for QQQ; over five years the annualized figures are +11.59% and +15.34% respectively. Across the full 7-year window we track, QQQ has the edge at +13.06% annualized vs +12.42%. 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 20.4% for AFMC. 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 -42.1% for AFMC 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 0.71. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
AFMC charges 0.68% per year while QQQ charges 0.18%. On a $10,000 position that is $68 vs $18 annually, a gap of $50 per year that compounds over a long holding period. On income, AFMC currently yields 0.70% against 0.44% for QQQ.
Holdings Overlap
AFMC and QQQ share 1 holdings out of 363 unique holdings combined, representing a 0.3% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in AFMC | Weight in QQQ | Difference |
|---|---|---|---|
| LITE | 0.53% | 0.28% | 0.25% |
Frequently Asked Questions
Which is cheaper, AFMC or QQQ?
AFMC has an expense ratio of 0.68% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $50 per year of difference.
Which performed better, AFMC or QQQ?
Over the past year AFMC returned +27.23% vs +24.93% for QQQ, so AFMC leads on 1-year performance. Over the longest common window we track (7 years), AFMC annualized +12.42% vs +13.06% for QQQ. Past performance does not guarantee future results.
Which is riskier, AFMC or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 20.4% for AFMC. Worst drawdown: AFMC -42.1% vs QQQ -83.0%.
Should I hold both AFMC and QQQ?
AFMC and QQQ have a monthly-return correlation of 0.71, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between AFMC and QQQ?
AFMC and QQQ share 1 common holdings with a 0.3% weight overlap. Combined, they hold 363 unique securities.
Which pays a higher dividend, AFMC or QQQ?
AFMC yields 0.70% while QQQ yields 0.44%, so AFMC currently pays the higher dividend yield.
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