FXZ vs QQQ
First Trust Materials AlphaDEX Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. FXZ delivered stronger 1-year returns. QQQ offers more diversification with 108 holdings.
Side-by-Side Comparison
| Metric | FXZ | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.64% | 0.18% | |
| AUM | $390M | $496.3B | |
| Dividend Yield | 1.42% | 0.44% | |
| Holdings | 40 | 108 | |
| YTD Return | +32.21% | +16.64% | |
| 1Y Return | +49.72% | +27.27% | |
| 3Y Return (annualized) | +12.27% | +25.96% | |
| 5Y Return (annualized) | +10.66% | +14.54% | |
| Volatility (annualized) | 24.7% | 30.6% | |
| Max Drawdown | -66.0% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | May 8, 2007 | Mar 10, 1999 |
FXZ vs QQQ Performance
First Trust Materials AlphaDEX Fund (FXZ) 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 FXZ returned +49.72% while QQQ returned +27.27%. Year to date, FXZ is up 32.21% versus a gain of 16.64% for QQQ.
Over three years, FXZ compounded at +12.27% per year against +25.96% for QQQ; over five years the annualized figures are +10.66% and +14.54% respectively. Across the full 19-year window we track, QQQ has the edge at +13.03% annualized vs +8.47%. 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 24.7% for FXZ. 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 -66.0% for FXZ 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 0.71. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
FXZ charges 0.64% per year while QQQ charges 0.18%. On a $10,000 position that is $64 vs $18 annually, a gap of $46 per year that compounds over a long holding period. On income, FXZ currently yields 1.42% against 0.44% for QQQ.
Holdings Overlap
Frequently Asked Questions
Which is cheaper, FXZ or QQQ?
FXZ has an expense ratio of 0.64% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $46 per year of difference.
Which performed better, FXZ or QQQ?
Over the past year FXZ returned +49.72% vs +27.27% for QQQ, so FXZ leads on 1-year performance. Over the longest common window we track (19 years), FXZ annualized +8.47% vs +13.03% for QQQ. Past performance does not guarantee future results.
Which is riskier, FXZ or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 24.7% for FXZ. Worst drawdown: FXZ -66.0% vs QQQ -83.0%.
Should I hold both FXZ and QQQ?
FXZ and QQQ have a monthly-return correlation of 0.71, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FXZ and QQQ?
FXZ and QQQ share 2 common holdings with a 1.3% weight overlap. Combined, they hold 139 unique securities.
Which pays a higher dividend, FXZ or QQQ?
FXZ yields 1.42% while QQQ yields 0.44%, so FXZ currently pays the higher dividend yield.
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