PEPS vs QQQ
Parametric Equity Plus ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
PEPS has a lower expense ratio. QQQ delivered stronger 1-year returns. PEPS offers more diversification with 193 holdings.
Side-by-Side Comparison
| Metric | PEPS | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.10% | 0.18% | |
| AUM | $30M | $496.3B | |
| Dividend Yield | 0.93% | 0.44% | |
| Holdings | 193 | 108 | |
| YTD Return | +11.03% | +16.23% | |
| 1Y Return | +21.91% | +26.23% | |
| 3Y Return (annualized) | - | +25.75% | |
| 5Y Return (annualized) | - | +14.78% | |
| Volatility (annualized) | 13.3% | 30.6% | |
| Max Drawdown | -21.0% | -83.0% | |
| Fund Family | Parametric | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Nov 7, 2024 | Mar 10, 1999 |
PEPS vs QQQ Performance
Parametric Equity Plus ETF (PEPS) is a ETF from Parametric and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year PEPS returned +21.91% while QQQ returned +26.23%. Year to date, PEPS is up 11.03% versus a gain of 16.23% for QQQ.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 13.3% for PEPS. 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 -21.0% for PEPS 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 0.89. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
PEPS charges 0.10% per year while QQQ charges 0.18%. On a $10,000 position that is $10 vs $18 annually, a gap of $8 per year that compounds over a long holding period. On income, PEPS currently yields 0.93% against 0.44% for QQQ.
Holdings Overlap
PEPS and QQQ share 34 holdings out of 243 unique holdings combined, representing a 45.9% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, PEPS or QQQ?
PEPS has an expense ratio of 0.10% while QQQ charges 0.18%. PEPS is the cheaper option. On a $10,000 investment, that is $8 per year of difference.
Which performed better, PEPS or QQQ?
Over the past year PEPS returned +21.91% vs +26.23% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (2 years), PEPS annualized +17.04% vs +13.02% for QQQ. Past performance does not guarantee future results.
Which is riskier, PEPS or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 13.3% for PEPS. Worst drawdown: PEPS -21.0% vs QQQ -83.0%.
Should I hold both PEPS and QQQ?
PEPS and QQQ have a monthly-return correlation of 0.89, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between PEPS and QQQ?
PEPS and QQQ share 34 common holdings with a 45.9% weight overlap. Combined, they hold 243 unique securities.
Which pays a higher dividend, PEPS or QQQ?
PEPS yields 0.93% while QQQ yields 0.44%, so PEPS currently pays the higher dividend yield.
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