IGI vs QQQ
Western Asset Investment Grade Defined Opportunity Trust Inc. vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. IGI offers more diversification with 415 holdings.
Side-by-Side Comparison
| Metric | IGI | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.85% | 0.18% | |
| AUM | $103M | $496.3B | |
| Dividend Yield | 5.01% | 0.44% | |
| Holdings | 415 | 108 | |
| YTD Return | -0.13% | +16.64% | |
| 1Y Return | +1.85% | +27.27% | |
| 3Y Return (annualized) | +4.74% | +25.96% | |
| 5Y Return (annualized) | -1.48% | +14.54% | |
| Volatility (annualized) | 11.2% | 30.6% | |
| Max Drawdown | -34.0% | -83.0% | |
| Fund Family | Franklin Templeton Investments (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jun 26, 2009 | Mar 10, 1999 |
IGI vs QQQ Performance
Western Asset Investment Grade Defined Opportunity Trust Inc. (IGI) is a ETF from Franklin Templeton Investments (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year IGI returned +1.85% while QQQ returned +27.27%. Year to date, IGI is down 0.13% versus a gain of 16.64% for QQQ.
Over three years, IGI compounded at +4.74% per year against +25.96% for QQQ; over five years the annualized figures are -1.48% and +14.54% respectively. Across the full 17-year window we track, QQQ has the edge at +13.03% annualized vs +0.21%. 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 11.2% for IGI. 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 -34.0% for IGI 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 0.36. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
IGI 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, IGI currently yields 5.01% against 0.44% for QQQ.
Holdings Overlap
IGI and QQQ share 0 holdings out of 387 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, IGI or QQQ?
IGI 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, IGI or QQQ?
Over the past year IGI returned +1.85% vs +27.27% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (17 years), IGI annualized +0.21% vs +13.03% for QQQ. Past performance does not guarantee future results.
Which is riskier, IGI or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 11.2% for IGI. Worst drawdown: IGI -34.0% vs QQQ -83.0%.
Should I hold both IGI and QQQ?
IGI and QQQ have a monthly-return correlation of 0.36, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IGI and QQQ?
IGI and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 387 unique securities.
Which pays a higher dividend, IGI or QQQ?
IGI yields 5.01% while QQQ yields 0.44%, so IGI currently pays the higher dividend yield.
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