FZROX vs QQQ
Fidelity ZERO Total Market Index Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
FZROX has a lower expense ratio. QQQ delivered stronger 1-year returns. FZROX offers more diversification with 2515 holdings.
Side-by-Side Comparison
| Metric | FZROX | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.00% | 0.18% | |
| AUM | $3.1B | $455.8B | |
| Dividend Yield | 0.92% | 0.41% | |
| Holdings | 2,533 | 108 | |
| YTD Return | +14.30% | +19.68% | |
| 1Y Return | +20.98% | +26.75% | |
| 3Y Return (annualized) | +19.99% | +26.25% | |
| 5Y Return (annualized) | +11.04% | +15.39% | |
| Volatility (annualized) | 15.6% | 30.6% | |
| Max Drawdown | -26.9% | -83.0% | |
| Fund Family | Fidelity Investments (US) | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Aug 2, 2018 | Mar 10, 1999 |
FZROX vs QQQ Performance
Fidelity ZERO Total Market Index Fund (FZROX) is a mutual fund from Fidelity Investments (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year FZROX returned +20.98% while QQQ returned +26.75%. Year to date, FZROX is up 14.30% versus a gain of 19.68% for QQQ.
Over three years, FZROX compounded at +19.99% per year against +26.25% for QQQ; over five years the annualized figures are +11.04% and +15.39% respectively. Across the full 5-year window we track, QQQ has the edge at +13.15% annualized vs +11.04%. 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 15.6% for FZROX. 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 -26.9% for FZROX 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 0.87. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
FZROX charges 0.00% per year while QQQ charges 0.18%. On a $10,000 position that is $0 vs $18 annually, a gap of $18 per year that compounds over a long holding period. On income, FZROX currently yields 0.92% against 0.41% for QQQ.
Holdings Overlap
FZROX and QQQ share 89 holdings out of 2529 unique holdings combined, representing a 44.1% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FZROX or QQQ?
FZROX has an expense ratio of 0.00% while QQQ charges 0.18%. FZROX is the cheaper option. On a $10,000 investment, that is $18 per year of difference.
Which performed better, FZROX or QQQ?
Over the past year FZROX returned +20.98% vs +26.75% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (5 years), FZROX annualized +11.04% vs +13.15% for QQQ. Past performance does not guarantee future results.
Which is riskier, FZROX or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 15.6% for FZROX. Worst drawdown: FZROX -26.9% vs QQQ -83.0%.
Should I hold both FZROX and QQQ?
FZROX and QQQ have a monthly-return correlation of 0.87, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FZROX and QQQ?
FZROX and QQQ share 89 common holdings with a 44.1% weight overlap. Combined, they hold 2529 unique securities.
Which pays a higher dividend, FZROX or QQQ?
FZROX yields 0.92% while QQQ yields 0.41%, so FZROX currently pays the higher dividend yield.
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