PSDM vs QQQ
PGIM Short Duration Multi-Sector Bond ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. PSDM offers more diversification with 322 holdings.
Side-by-Side Comparison
| Metric | PSDM | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.40% | 0.18% | |
| AUM | $219M | $455.8B | |
| Dividend Yield | 5.23% | 0.41% | |
| Holdings | 848 | 108 | |
| YTD Return | -1.04% | +19.68% | |
| 1Y Return | +0.58% | +26.75% | |
| 3Y Return (annualized) | +4.69% | +26.25% | |
| 5Y Return (annualized) | - | +15.39% | |
| Volatility (annualized) | 2.2% | 30.6% | |
| Max Drawdown | -2.2% | -83.0% | |
| Fund Family | PGIM Investments | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jul 19, 2023 | Mar 10, 1999 |
PSDM vs QQQ Performance
PGIM Short Duration Multi-Sector Bond ETF (PSDM) is a ETF from PGIM Investments and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year PSDM returned +0.58% while QQQ returned +26.75%. Year to date, PSDM is down 1.04% versus a gain of 19.68% for QQQ.
Over three years, PSDM compounded at +4.69% per year against +26.25% for QQQ. Across the full 3-year window we track, QQQ has the edge at +13.15% annualized vs +4.63%. 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 2.2% for PSDM. 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 -2.2% for PSDM 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
PSDM charges 0.40% per year while QQQ charges 0.18%. On a $10,000 position that is $40 vs $18 annually, a gap of $22 per year that compounds over a long holding period. On income, PSDM currently yields 5.23% against 0.41% for QQQ.
Holdings Overlap
PSDM and QQQ share 0 holdings out of 425 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, PSDM or QQQ?
PSDM has an expense ratio of 0.40% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $22 per year of difference.
Which performed better, PSDM or QQQ?
Over the past year PSDM returned +0.58% vs +26.75% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (3 years), PSDM annualized +4.63% vs +13.15% for QQQ. Past performance does not guarantee future results.
Which is riskier, PSDM or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 2.2% for PSDM. Worst drawdown: PSDM -2.2% vs QQQ -83.0%.
Should I hold both PSDM and QQQ?
PSDM 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 PSDM and QQQ?
PSDM and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 425 unique securities.
Which pays a higher dividend, PSDM or QQQ?
PSDM yields 5.23% while QQQ yields 0.41%, so PSDM currently pays the higher dividend yield.
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