PZA vs QQQ
Invesco National AMT-Free Municipal Bond ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. PZA offers more diversification with 6,806 holdings.
Side-by-Side Comparison
| Metric | PZA | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.28% | 0.18% | |
| AUM | $4.3B | $496.3B | |
| Dividend Yield | 3.77% | 0.44% | |
| Holdings | 6,806 | 108 | |
| YTD Return | +0.28% | +16.64% | |
| 1Y Return | +7.06% | +27.27% | |
| 3Y Return (annualized) | +3.35% | +25.96% | |
| 5Y Return (annualized) | -0.41% | +14.54% | |
| Volatility (annualized) | 7.0% | 30.6% | |
| Max Drawdown | -27.0% | -83.0% | |
| Fund Family | Invesco (US) | Invesco (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Oct 11, 2007 | Mar 10, 1999 |
PZA vs QQQ Performance
Invesco National AMT-Free Municipal Bond ETF (PZA) is a ETF from Invesco (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year PZA returned +7.06% while QQQ returned +27.27%. Year to date, PZA is up 0.28% versus a gain of 16.64% for QQQ.
Over three years, PZA compounded at +3.35% per year against +25.96% for QQQ; over five years the annualized figures are -0.41% and +14.54% respectively. Across the full 19-year window we track, QQQ has the edge at +13.03% annualized vs +0.38%. 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 7.0% for PZA. 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 -27.0% for PZA 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 0.37. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
PZA charges 0.28% per year while QQQ charges 0.18%. On a $10,000 position that is $28 vs $18 annually, a gap of $10 per year that compounds over a long holding period. On income, PZA currently yields 3.77% against 0.44% for QQQ.
Holdings Overlap
PZA and QQQ share 0 holdings out of 1231 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, PZA or QQQ?
PZA has an expense ratio of 0.28% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $10 per year of difference.
Which performed better, PZA or QQQ?
Over the past year PZA returned +7.06% vs +27.27% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (19 years), PZA annualized +0.38% vs +13.03% for QQQ. Past performance does not guarantee future results.
Which is riskier, PZA or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 7.0% for PZA. Worst drawdown: PZA -27.0% vs QQQ -83.0%.
Should I hold both PZA and QQQ?
PZA and QQQ have a monthly-return correlation of 0.37, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between PZA and QQQ?
PZA and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 1231 unique securities.
Which pays a higher dividend, PZA or QQQ?
PZA yields 3.77% while QQQ yields 0.44%, so PZA currently pays the higher dividend yield.
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