NMCO vs QQQ
NMCO vs QQQ
Nuveen Municipal Credit Opportunities Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. NMCO offers more diversification with 155 holdings.
Side-by-Side Comparison
| Metric | NMCO | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 4.50% | 0.18% | |
| AUM | - | $455.8B | |
| Dividend Yield | 7.60% | 0.41% | |
| Holdings | 430 | 108 | |
| YTD Return | +7.53% | +18.20% | |
| 1Y Return | +12.13% | +27.63% | |
| 3Y Return (annualized) | +4.91% | +25.54% | |
| 5Y Return (annualized) | -1.71% | +15.12% | |
| Volatility (annualized) | 20.2% | 30.6% | |
| Max Drawdown | -43.0% | -83.0% | |
| Fund Family | Nuveen | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Sep 16, 2019 | Mar 10, 1999 |
NMCO vs QQQ Performance
Nuveen Municipal Credit Opportunities Fund (NMCO) is a ETF from Nuveen and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year NMCO returned +12.13% while QQQ returned +27.63%. Year to date, NMCO is up 7.53% versus a gain of 18.20% for QQQ.
Over three years, NMCO compounded at +4.91% per year against +25.54% for QQQ; over five years the annualized figures are -1.71% and +15.12% respectively. Across the full 7-year window we track, QQQ has the edge at +13.11% annualized vs -0.38%. 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 20.2% for NMCO. 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 -43.0% for NMCO 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 0.56. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
NMCO charges 4.50% per year while QQQ charges 0.18%. On a $10,000 position that is $450 vs $18 annually, a gap of $432 per year that compounds over a long holding period. On income, NMCO currently yields 7.60% against 0.41% for QQQ.
Holdings Overlap
NMCO and QQQ share 0 holdings out of 258 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, NMCO or QQQ?
NMCO has an expense ratio of 4.50% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $432 per year of difference.
Which performed better, NMCO or QQQ?
Over the past year NMCO returned +12.13% vs +27.63% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (7 years), NMCO annualized -0.38% vs +13.11% for QQQ. Past performance does not guarantee future results.
Which is riskier, NMCO or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 20.2% for NMCO. Worst drawdown: NMCO -43.0% vs QQQ -83.0%.
Should I hold both NMCO and QQQ?
NMCO and QQQ have a monthly-return correlation of 0.56, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between NMCO and QQQ?
NMCO and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 258 unique securities.
Which pays a higher dividend, NMCO or QQQ?
NMCO yields 7.60% while QQQ yields 0.41%, so NMCO currently pays the higher dividend yield.
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