FPE vs QQQ
First Trust Preferred Securities and Income ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. FPE offers more diversification with 260 holdings.
Side-by-Side Comparison
| Metric | FPE | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.85% | 0.18% | |
| AUM | $6.3B | $496.3B | |
| Dividend Yield | 5.89% | 0.44% | |
| Holdings | 260 | 108 | |
| YTD Return | +0.18% | +17.30% | |
| 1Y Return | +3.23% | +24.93% | |
| 3Y Return (annualized) | +9.41% | +26.19% | |
| 5Y Return (annualized) | +2.54% | +15.34% | |
| Volatility (annualized) | 8.4% | 30.6% | |
| Max Drawdown | -34.8% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Allocation/Balanced | Equity | |
| Inception | Feb 11, 2013 | Mar 10, 1999 |
FPE vs QQQ Performance
First Trust Preferred Securities and Income ETF (FPE) 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 FPE returned +3.23% while QQQ returned +24.93%. Year to date, FPE is up 0.18% versus a gain of 17.30% for QQQ.
Over three years, FPE compounded at +9.41% per year against +26.19% for QQQ; over five years the annualized figures are +2.54% and +15.34% respectively. Across the full 14-year window we track, QQQ has the edge at +13.06% annualized vs +1.31%. 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 8.4% for FPE. 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 -34.8% for FPE 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 0.55. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FPE charges 0.85% per year while QQQ charges 0.18%. On a $10,000 position that is $85 vs $18 annually, a gap of $67 per year that compounds over a long holding period. On income, FPE currently yields 5.89% against 0.44% for QQQ.
Holdings Overlap
FPE and QQQ share 0 holdings out of 303 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, FPE or QQQ?
FPE has an expense ratio of 0.85% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $67 per year of difference.
Which performed better, FPE or QQQ?
Over the past year FPE returned +3.23% vs +24.93% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (14 years), FPE annualized +1.31% vs +13.06% for QQQ. Past performance does not guarantee future results.
Which is riskier, FPE or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 8.4% for FPE. Worst drawdown: FPE -34.8% vs QQQ -83.0%.
Should I hold both FPE and QQQ?
FPE and QQQ have a monthly-return correlation of 0.55, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FPE and QQQ?
FPE and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 303 unique securities.
Which pays a higher dividend, FPE or QQQ?
FPE yields 5.89% while QQQ yields 0.44%, so FPE currently pays the higher dividend yield.
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