BCAT vs QQQ
BlackRock Capital Allocation Term Trust vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. BCAT delivered stronger 1-year returns. BCAT offers more diversification with 917 holdings.
Side-by-Side Comparison
| Metric | BCAT | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 1.41% | 0.18% | |
| AUM | $1.6B | $496.3B | |
| Dividend Yield | 22.04% | 0.44% | |
| Holdings | 917 | 108 | |
| YTD Return | +26.01% | +17.30% | |
| 1Y Return | +31.02% | +24.93% | |
| 3Y Return (annualized) | +22.70% | +26.19% | |
| 5Y Return (annualized) | +9.16% | +15.34% | |
| Volatility (annualized) | 14.8% | 30.6% | |
| Max Drawdown | -36.1% | -83.0% | |
| Fund Family | BlackRock, Inc. (US) | Invesco (US) | |
| Category | Allocation/Balanced | Equity | |
| Inception | Sep 25, 2020 | Mar 10, 1999 |
BCAT vs QQQ Performance
BlackRock Capital Allocation Term Trust (BCAT) is a ETF from BlackRock, Inc. (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year BCAT returned +31.02% while QQQ returned +24.93%. Year to date, BCAT is up 26.01% versus a gain of 17.30% for QQQ.
Over three years, BCAT compounded at +22.70% per year against +26.19% for QQQ; over five years the annualized figures are +9.16% and +15.34% respectively. Across the full 6-year window we track, QQQ has the edge at +13.06% annualized vs +9.23%. 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 14.8% for BCAT. 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 -36.1% for BCAT 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 0.74. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
BCAT charges 1.41% per year while QQQ charges 0.18%. On a $10,000 position that is $141 vs $18 annually, a gap of $123 per year that compounds over a long holding period. On income, BCAT currently yields 22.04% against 0.44% for QQQ.
Holdings Overlap
BCAT and QQQ share 28 holdings out of 390 unique holdings combined, representing a 21.7% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, BCAT or QQQ?
BCAT has an expense ratio of 1.41% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $123 per year of difference.
Which performed better, BCAT or QQQ?
Over the past year BCAT returned +31.02% vs +24.93% for QQQ, so BCAT leads on 1-year performance. Over the longest common window we track (6 years), BCAT annualized +9.23% vs +13.06% for QQQ. Past performance does not guarantee future results.
Which is riskier, BCAT or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 14.8% for BCAT. Worst drawdown: BCAT -36.1% vs QQQ -83.0%.
Should I hold both BCAT and QQQ?
BCAT and QQQ have a monthly-return correlation of 0.74, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between BCAT and QQQ?
BCAT and QQQ share 28 common holdings with a 21.7% weight overlap. Combined, they hold 390 unique securities.
Which pays a higher dividend, BCAT or QQQ?
BCAT yields 22.04% while QQQ yields 0.44%, so BCAT currently pays the higher dividend yield.
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