OCTP vs QQQ

OCTP vs QQQ
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Quick Verdict

QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. QQQ offers more diversification with 108 holdings.

Lower Fees: QQQHigher Returns: QQQMore Diversified: QQQ

Side-by-Side Comparison

MetricOCTPQQQWinner
Expense Ratio0.50%0.18%
AUM$29M$496.3B
Dividend Yield0.00%0.44%
Holdings7108
YTD Return+9.24%+17.89%
1Y Return+13.73%+26.35%
3Y Return (annualized)-+26.02%
5Y Return (annualized)-+14.59%
Volatility (annualized)6.9%30.6%
Max Drawdown-12.0%-83.0%
Fund FamilyPGIM InvestmentsInvesco (US)
CategoryAlternativeEquity
InceptionMay 17, 2024Mar 10, 1999

OCTP vs QQQ Performance

PGIM S&P 500 Buffer 12 ETF - October (OCTP) is a ETF from PGIM Investments and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year OCTP returned +13.73% while QQQ returned +26.35%. Year to date, OCTP is up 9.24% versus a gain of 17.89% for QQQ.

Risk: Volatility and Drawdowns

QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 6.9% for OCTP. 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 -12.0% for OCTP 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 0.86. They usually move together, but the gap leaves some room for diversification.

Fees and Cost Over Time

OCTP charges 0.50% per year while QQQ charges 0.18%. On a $10,000 position that is $50 vs $18 annually, a gap of $32 per year that compounds over a long holding period. On income, OCTP currently yields 0.00% against 0.44% for QQQ.

Frequently Asked Questions

Which is cheaper, OCTP or QQQ?

OCTP has an expense ratio of 0.50% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $32 per year of difference.

Which performed better, OCTP or QQQ?

Over the past year OCTP returned +13.73% vs +26.35% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (2 years), OCTP annualized +13.13% vs +13.07% for QQQ. Past performance does not guarantee future results.

Which is riskier, OCTP or QQQ?

QQQ has been the more volatile fund at 30.6% annualized versus 6.9% for OCTP. Worst drawdown: OCTP -12.0% vs QQQ -83.0%.

Should I hold both OCTP and QQQ?

OCTP and QQQ have a monthly-return correlation of 0.86, so combining them can provide real diversification depending on your allocation goals.

Which pays a higher dividend, OCTP or QQQ?

OCTP yields 0.00% while QQQ yields 0.44%, so QQQ currently pays the higher dividend yield.

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