NMZ vs QQQ
NMZ vs QQQ
Nuveen Municipal High Income Opportunity Fund vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. NMZ offers more diversification with 235 holdings.
Side-by-Side Comparison
| Metric | NMZ | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 3.75% | 0.18% | |
| AUM | - | $455.8B | |
| Dividend Yield | 7.49% | 0.41% | |
| Holdings | 893 | 108 | |
| YTD Return | +5.42% | +18.20% | |
| 1Y Return | +10.50% | +27.63% | |
| 3Y Return (annualized) | +6.76% | +25.54% | |
| 5Y Return (annualized) | -1.81% | +15.12% | |
| Volatility (annualized) | 14.1% | 30.6% | |
| Max Drawdown | -63.5% | -83.0% | |
| Fund Family | Nuveen | Invesco (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Nov 19, 2003 | Mar 10, 1999 |
NMZ vs QQQ Performance
Nuveen Municipal High Income Opportunity Fund (NMZ) is a ETF from Nuveen and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year NMZ returned +10.50% while QQQ returned +27.63%. Year to date, NMZ is up 5.42% versus a gain of 18.20% for QQQ.
Over three years, NMZ compounded at +6.76% per year against +25.54% for QQQ; over five years the annualized figures are -1.81% and +15.12% respectively. Across the full 23-year window we track, QQQ has the edge at +13.11% annualized vs -0.23%. 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 14.1% for NMZ. 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 -63.5% for NMZ 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 0.39. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
NMZ charges 3.75% per year while QQQ charges 0.18%. On a $10,000 position that is $375 vs $18 annually, a gap of $357 per year that compounds over a long holding period. On income, NMZ currently yields 7.49% against 0.41% for QQQ.
Holdings Overlap
NMZ and QQQ share 0 holdings out of 338 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, NMZ or QQQ?
NMZ has an expense ratio of 3.75% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $357 per year of difference.
Which performed better, NMZ or QQQ?
Over the past year NMZ returned +10.50% vs +27.63% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (23 years), NMZ annualized -0.23% vs +13.11% for QQQ. Past performance does not guarantee future results.
Which is riskier, NMZ or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 14.1% for NMZ. Worst drawdown: NMZ -63.5% vs QQQ -83.0%.
Should I hold both NMZ and QQQ?
NMZ and QQQ have a monthly-return correlation of 0.39, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between NMZ and QQQ?
NMZ and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 338 unique securities.
Which pays a higher dividend, NMZ or QQQ?
NMZ yields 7.49% while QQQ yields 0.41%, so NMZ currently pays the higher dividend yield.
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