PFN vs QQQ
PIMCO Income Strategy Fund II vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. PFN offers more diversification with 513 holdings.
Side-by-Side Comparison
| Metric | PFN | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 1.29% | 0.18% | |
| AUM | $686M | $496.3B | |
| Dividend Yield | 12.54% | 0.44% | |
| Holdings | 513 | 108 | |
| YTD Return | +0.59% | +16.64% | |
| 1Y Return | +4.50% | +27.27% | |
| 3Y Return (annualized) | +13.12% | +25.96% | |
| 5Y Return (annualized) | +2.14% | +14.54% | |
| Volatility (annualized) | 18.7% | 30.6% | |
| Max Drawdown | -83.4% | -83.0% | |
| Fund Family | PIMCO (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Oct 29, 2004 | Mar 10, 1999 |
PFN vs QQQ Performance
PIMCO Income Strategy Fund II (PFN) is a ETF from PIMCO (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year PFN returned +4.50% while QQQ returned +27.27%. Year to date, PFN is up 0.59% versus a gain of 16.64% for QQQ.
Over three years, PFN compounded at +13.12% per year against +25.96% for QQQ; over five years the annualized figures are +2.14% and +14.54% respectively. Across the full 22-year window we track, QQQ has the edge at +13.03% annualized vs -1.97%. 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 18.7% for PFN. 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 -83.4% for PFN 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 0.52. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
PFN charges 1.29% per year while QQQ charges 0.18%. On a $10,000 position that is $129 vs $18 annually, a gap of $111 per year that compounds over a long holding period. On income, PFN currently yields 12.54% against 0.44% for QQQ.
Holdings Overlap
PFN and QQQ share 0 holdings out of 125 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, PFN or QQQ?
PFN has an expense ratio of 1.29% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $111 per year of difference.
Which performed better, PFN or QQQ?
Over the past year PFN returned +4.50% vs +27.27% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (22 years), PFN annualized -1.97% vs +13.03% for QQQ. Past performance does not guarantee future results.
Which is riskier, PFN or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 18.7% for PFN. Worst drawdown: PFN -83.4% vs QQQ -83.0%.
Should I hold both PFN and QQQ?
PFN and QQQ have a monthly-return correlation of 0.52, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between PFN and QQQ?
PFN and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 125 unique securities.
Which pays a higher dividend, PFN or QQQ?
PFN yields 12.54% while QQQ yields 0.44%, so PFN currently pays the higher dividend yield.
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