DFAR vs QQQ
Dimensional US Real Estate ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. DFAR offers more diversification with 124 holdings.
Side-by-Side Comparison
| Metric | DFAR | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.19% | 0.18% | |
| AUM | $1.8B | $455.8B | |
| Dividend Yield | 2.69% | 0.41% | |
| Holdings | 130 | 108 | |
| YTD Return | +14.99% | +17.85% | |
| 1Y Return | +17.79% | +26.45% | |
| 3Y Return (annualized) | +10.04% | +26.07% | |
| 5Y Return (annualized) | - | +15.16% | |
| Volatility (annualized) | 18.4% | 30.6% | |
| Max Drawdown | -32.3% | -83.0% | |
| Fund Family | Dimensional | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Feb 23, 2022 | Mar 10, 1999 |
DFAR vs QQQ Performance
Dimensional US Real Estate ETF (DFAR) is a ETF from Dimensional and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year DFAR returned +17.79% while QQQ returned +26.45%. Year to date, DFAR is up 14.99% versus a gain of 17.85% for QQQ.
Over three years, DFAR compounded at +10.04% per year against +26.07% for QQQ. Across the full 5-year window we track, QQQ has the edge at +13.09% annualized vs +3.56%. 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 18.4% for DFAR. 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 -32.3% for DFAR 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 0.61. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
DFAR charges 0.19% per year while QQQ charges 0.18%. On a $10,000 position that is $19 vs $18 annually, a gap of $1 per year that compounds over a long holding period. On income, DFAR currently yields 2.69% against 0.41% for QQQ.
Holdings Overlap
DFAR and QQQ share 0 holdings out of 227 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, DFAR or QQQ?
DFAR has an expense ratio of 0.19% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, DFAR or QQQ?
Over the past year DFAR returned +17.79% vs +26.45% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (5 years), DFAR annualized +3.56% vs +13.09% for QQQ. Past performance does not guarantee future results.
Which is riskier, DFAR or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 18.4% for DFAR. Worst drawdown: DFAR -32.3% vs QQQ -83.0%.
Should I hold both DFAR and QQQ?
DFAR and QQQ have a monthly-return correlation of 0.61, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between DFAR and QQQ?
DFAR and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 227 unique securities.
Which pays a higher dividend, DFAR or QQQ?
DFAR yields 2.69% while QQQ yields 0.41%, so DFAR currently pays the higher dividend yield.
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