QQQ vs SMOT
Invesco QQQ Trust, Series 1 vs VanEck Morningstar SMID Moat ETF
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. SMOT offers more diversification with 112 holdings.
Side-by-Side Comparison
| Metric | QQQ | SMOT | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 0.49% | |
| AUM | $496.3B | $339M | |
| Dividend Yield | 0.44% | 1.24% | |
| Holdings | 108 | 112 | |
| YTD Return | +16.64% | +13.25% | |
| 1Y Return | +27.27% | +15.63% | |
| 3Y Return (annualized) | +25.96% | +13.27% | |
| 5Y Return (annualized) | +14.54% | - | |
| Volatility (annualized) | 30.6% | 17.2% | |
| Max Drawdown | -83.0% | -23.4% | |
| Fund Family | Invesco (US) | VanEck | |
| Category | Equity | Equity | |
| Inception | Mar 10, 1999 | Oct 4, 2022 |
QQQ vs SMOT Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and VanEck Morningstar SMID Moat ETF (SMOT) is a ETF from VanEck. Over the past year QQQ returned +27.27% while SMOT returned +15.63%. Year to date, QQQ is up 16.64% versus a gain of 13.25% for SMOT.
Over three years, QQQ compounded at +25.96% per year against +13.27% for SMOT. Across the full 4-year window we track, SMOT has the edge at +13.60% annualized vs +13.03%. 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 17.2% for SMOT. 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 -83.0% for QQQ and -23.4% for SMOT. 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 0.62. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
QQQ charges 0.18% per year while SMOT charges 0.49%. On a $10,000 position that is $18 vs $49 annually, a gap of $31 per year that compounds over a long holding period. On income, QQQ currently yields 0.44% against 1.24% for SMOT.
Holdings Overlap
QQQ and SMOT share 8 holdings out of 204 unique holdings combined, representing a 2.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, QQQ or SMOT?
QQQ has an expense ratio of 0.18% while SMOT charges 0.49%. QQQ is the cheaper option. On a $10,000 investment, that is $31 per year of difference.
Which performed better, QQQ or SMOT?
Over the past year QQQ returned +27.27% vs +15.63% for SMOT, so QQQ leads on 1-year performance. Over the longest common window we track (4 years), QQQ annualized +13.03% vs +13.60% for SMOT. Past performance does not guarantee future results.
Which is riskier, QQQ or SMOT?
QQQ has been the more volatile fund at 30.6% annualized versus 17.2% for SMOT. Worst drawdown: QQQ -83.0% vs SMOT -23.4%.
Should I hold both QQQ and SMOT?
QQQ and SMOT have a monthly-return correlation of 0.62, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between QQQ and SMOT?
QQQ and SMOT share 8 common holdings with a 2.0% weight overlap. Combined, they hold 204 unique securities.
Which pays a higher dividend, QQQ or SMOT?
QQQ yields 0.44% while SMOT yields 1.24%, so SMOT currently pays the higher dividend yield.
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