PREF vs QQQ
Principal Spectrum Preferred Securities Active ETF vs Invesco QQQ Trust, Series 1
Which is better, PREF or QQQ?
Preferred Stock against Large Cap Growth.
QQQ has a lower expense ratio. QQQ led over 1Y, 3Y, 5Y and the full window.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | PREF | QQQ |
|---|---|---|
| Expense Ratio | 0.55% | 0.18%Best |
| AUM | $1.9B | $483.5B |
| Dividend Yield | 5.29% | 0.44% |
| Holdings | 163 | 107 |
| YTD Return | +0.26% | +21.16%Best |
| 1Y Return | +1.69% | +24.78%Best |
| 3Y Return (annualized) | +8.03% | +27.95%Best |
| 5Y Return (annualized) | +2.30% | +15.36%Best |
| Volatility (annualized) | 7.8%Best | 19.7% |
| Max Drawdown | -23.3%Best | -35.1% |
| $10,000 over 5 years | $11,204 | $20,430Best |
| Fund Family | Principal Funds | Invesco (US) |
| Category | Allocation/Balanced | Equity |
| Style | Preferred Stock | Large Cap Growth |
| Inception | Jul 10, 2017 | Mar 10, 1999 |
Not shown on this pair: Top 10 Weight.
Volatility and max drawdown are measured over the window both funds cover: Jul 11, 2017 to Sep 24, 2026 (9.2 years).
PREF vs QQQ growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view is available from the range buttons; it is not the opening view here because over the whole period one of these two funds moves so much further than the other that its line would sit flat on the axis.
PREF vs QQQ Performance
Principal Spectrum Preferred Securities Active ETF (PREF) is an ETF from Principal Funds and Invesco QQQ Trust, Series 1 (QQQ) is an ETF from Invesco (US). Over the past year PREF returned +1.69% while QQQ returned +24.78%. Year to date, PREF is up 0.26% versus a gain of 21.16% for QQQ.
Over three years, PREF compounded at +8.03% per year against +27.95% for QQQ; over five years the annualized figures are +2.30% and +15.36% respectively. Across the full 9-year window we track, QQQ has the edge at +20.36% annualized vs +1.91%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 19.7% compared with 7.8% for PREF. 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 -23.3% for PREF and -35.1% for QQQ. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.62. They move together some of the time, and apart the rest.
Fees and Cost Over Time
PREF charges 0.55% per year while QQQ charges 0.18%. On a $10,000 position that is $55 vs $18 annually, a gap of $37 per year that compounds over a long holding period. On income, PREF currently yields 5.29% against 0.44% for QQQ.
Holdings Overlap
We hold position weights for 111 holdings in PREF and 102 in QQQ, totalling 72.0% and 99.9% of the two funds. The two books name no position in common, so there is no overlap percentage to show.
0 positions in common, counted across the 111 positions we hold weights for in PREF and 102 in QQQ, against full books of 163 and 107.
You are not choosing between two funds in isolation.
Whichever of PREF and QQQ you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, PREF or QQQ?
PREF has an expense ratio of 0.55% while QQQ charges 0.18%. QQQ is the cheaper option, by $37 a year on a $10,000 investment.
Which performed better, PREF or QQQ?
Over the past year PREF returned +1.69% vs +24.78% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (9 years), PREF annualized +1.91% vs +20.36% for QQQ. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, PREF or QQQ?
QQQ has been the more volatile fund at 19.7% annualized versus 7.8% for PREF. Worst drawdown: PREF -23.3% vs QQQ -35.1%.
Should I hold both PREF and QQQ?
PREF and QQQ have a monthly-return correlation of 0.62, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, PREF or QQQ?
PREF yields 5.29% while QQQ yields 0.44%, so PREF currently pays the higher dividend yield.
Is QQQ better than PREF?
QQQ has a lower expense ratio. QQQ led over 1Y, 3Y, 5Y and the full window. Which one suits a particular account depends on what it is for. This is information, not a recommendation.