FCT vs QQQ
First Trust Senior Floating Rate Income Fund II vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. FCT offers more diversification with 221 holdings.
Side-by-Side Comparison
| Metric | FCT | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 1.67% | 0.18% | |
| AUM | $252M | $496.3B | |
| Dividend Yield | 11.84% | 0.44% | |
| Holdings | 221 | 108 | |
| YTD Return | +2.69% | +17.07% | |
| 1Y Return | +7.32% | +26.39% | |
| 3Y Return (annualized) | +10.56% | +26.08% | |
| 5Y Return (annualized) | +5.74% | +15.18% | |
| Volatility (annualized) | 14.8% | 30.6% | |
| Max Drawdown | -72.7% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | May 25, 2004 | Mar 10, 1999 |
FCT vs QQQ Performance
First Trust Senior Floating Rate Income Fund II (FCT) 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 FCT returned +7.32% while QQQ returned +26.39%. Year to date, FCT is up 2.69% versus a gain of 17.07% for QQQ.
Over three years, FCT compounded at +10.56% per year against +26.08% for QQQ; over five years the annualized figures are +5.74% and +15.18% respectively. Across the full 22-year window we track, QQQ has the edge at +13.05% annualized vs -0.76%. 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 FCT. 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 -72.7% for FCT 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 0.52. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FCT charges 1.67% per year while QQQ charges 0.18%. On a $10,000 position that is $167 vs $18 annually, a gap of $149 per year that compounds over a long holding period. On income, FCT currently yields 11.84% against 0.44% for QQQ.
Holdings Overlap
FCT and QQQ share 0 holdings out of 208 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, FCT or QQQ?
FCT has an expense ratio of 1.67% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $149 per year of difference.
Which performed better, FCT or QQQ?
Over the past year FCT returned +7.32% vs +26.39% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (22 years), FCT annualized -0.76% vs +13.05% for QQQ. Past performance does not guarantee future results.
Which is riskier, FCT or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 14.8% for FCT. Worst drawdown: FCT -72.7% vs QQQ -83.0%.
Should I hold both FCT and QQQ?
FCT and QQQ have a monthly-return correlation of 0.52, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FCT and QQQ?
FCT and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 208 unique securities.
Which pays a higher dividend, FCT or QQQ?
FCT yields 11.84% while QQQ yields 0.44%, so FCT currently pays the higher dividend yield.
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