FDL vs QQQ
First Trust Morningstar Dividend Leaders Index Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. QQQ offers more diversification with 108 holdings.
Side-by-Side Comparison
| Metric | FDL | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.43% | 0.18% | |
| AUM | $8.0B | $496.3B | |
| Dividend Yield | 3.59% | 0.44% | |
| Holdings | 101 | 108 | |
| YTD Return | +20.26% | +19.52% | |
| 1Y Return | +26.63% | +26.68% | |
| 3Y Return (annualized) | +20.32% | +26.64% | |
| 5Y Return (annualized) | +13.63% | +15.36% | |
| Volatility (annualized) | 16.1% | 30.6% | |
| Max Drawdown | -68.6% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Mar 9, 2006 | Mar 10, 1999 |
FDL vs QQQ Performance
First Trust Morningstar Dividend Leaders Index Fund (FDL) 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 FDL returned +26.63% while QQQ returned +26.68%. Year to date, FDL is up 20.26% versus a gain of 19.52% for QQQ.
Over three years, FDL compounded at +20.32% per year against +26.64% for QQQ; over five years the annualized figures are +13.63% and +15.36% respectively. Across the full 20-year window we track, QQQ has the edge at +13.14% annualized vs +5.93%. 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 16.1% for FDL. 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 -68.6% for FDL 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 0.53. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FDL charges 0.43% per year while QQQ charges 0.18%. On a $10,000 position that is $43 vs $18 annually, a gap of $25 per year that compounds over a long holding period. On income, FDL currently yields 3.59% against 0.44% for QQQ.
Holdings Overlap
FDL and QQQ share 6 holdings out of 196 unique holdings combined, representing a 2.1% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FDL or QQQ?
FDL has an expense ratio of 0.43% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $25 per year of difference.
Which performed better, FDL or QQQ?
Over the past year FDL returned +26.63% vs +26.68% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (20 years), FDL annualized +5.93% vs +13.14% for QQQ. Past performance does not guarantee future results.
Which is riskier, FDL or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 16.1% for FDL. Worst drawdown: FDL -68.6% vs QQQ -83.0%.
Should I hold both FDL and QQQ?
FDL and QQQ have a monthly-return correlation of 0.53, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FDL and QQQ?
FDL and QQQ share 6 common holdings with a 2.1% weight overlap. Combined, they hold 196 unique securities.
Which pays a higher dividend, FDL or QQQ?
FDL yields 3.59% while QQQ yields 0.44%, so FDL currently pays the higher dividend yield.
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