MUNI vs QQQ
PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. MUNI offers more diversification with 379 holdings.
Side-by-Side Comparison
| Metric | MUNI | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.35% | 0.18% | |
| AUM | $3.1B | $455.8B | |
| Dividend Yield | 3.28% | 0.41% | |
| Holdings | 580 | 108 | |
| YTD Return | +0.74% | +19.68% | |
| 1Y Return | +4.28% | +26.75% | |
| 3Y Return (annualized) | +3.70% | +26.25% | |
| 5Y Return (annualized) | +1.09% | +15.39% | |
| Volatility (annualized) | 3.9% | 30.6% | |
| Max Drawdown | -11.2% | -83.0% | |
| Fund Family | PIMCO (US) | Invesco (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Nov 30, 2009 | Mar 10, 1999 |
MUNI vs QQQ Performance
PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund (MUNI) is a ETF from PIMCO (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year MUNI returned +4.28% while QQQ returned +26.75%. Year to date, MUNI is up 0.74% versus a gain of 19.68% for QQQ.
Over three years, MUNI compounded at +3.70% per year against +26.25% for QQQ; over five years the annualized figures are +1.09% and +15.39% respectively. Across the full 17-year window we track, QQQ has the edge at +13.15% annualized vs +1.14%. 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 3.9% for MUNI. 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 -11.2% for MUNI 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 0.29. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
MUNI charges 0.35% per year while QQQ charges 0.18%. On a $10,000 position that is $35 vs $18 annually, a gap of $17 per year that compounds over a long holding period. On income, MUNI currently yields 3.28% against 0.41% for QQQ.
Holdings Overlap
MUNI and QQQ share 0 holdings out of 482 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, MUNI or QQQ?
MUNI has an expense ratio of 0.35% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $17 per year of difference.
Which performed better, MUNI or QQQ?
Over the past year MUNI returned +4.28% vs +26.75% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (17 years), MUNI annualized +1.14% vs +13.15% for QQQ. Past performance does not guarantee future results.
Which is riskier, MUNI or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 3.9% for MUNI. Worst drawdown: MUNI -11.2% vs QQQ -83.0%.
Should I hold both MUNI and QQQ?
MUNI and QQQ have a monthly-return correlation of 0.29, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between MUNI and QQQ?
MUNI and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 482 unique securities.
Which pays a higher dividend, MUNI or QQQ?
MUNI yields 3.28% while QQQ yields 0.41%, so MUNI currently pays the higher dividend yield.
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