QQQ vs TAFM
Invesco QQQ Trust, Series 1 vs AB Tax-Aware Intermediate Municipal ETF
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. TAFM offers more diversification with 672 holdings.
Side-by-Side Comparison
| Metric | QQQ | TAFM | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 0.28% | |
| AUM | $496.3B | $741M | |
| Dividend Yield | 0.44% | 3.68% | |
| Holdings | 108 | 672 | |
| YTD Return | +16.23% | +0.91% | |
| 1Y Return | +26.23% | +5.50% | |
| 3Y Return (annualized) | +25.75% | - | |
| 5Y Return (annualized) | +14.78% | - | |
| Volatility (annualized) | 30.6% | 4.0% | |
| Max Drawdown | -83.0% | -4.7% | |
| Fund Family | Invesco (US) | AllianceBernstein L.P. | |
| Category | Equity | Tax Preferred | |
| Inception | Mar 10, 1999 | Dec 13, 2023 |
QQQ vs TAFM Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and AB Tax-Aware Intermediate Municipal ETF (TAFM) is a ETF from AllianceBernstein L.P.. Over the past year QQQ returned +26.23% while TAFM returned +5.50%. Year to date, QQQ is up 16.23% versus a gain of 0.91% for TAFM.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 4.0% for TAFM. 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 -4.7% for TAFM. 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 0.46. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
QQQ charges 0.18% per year while TAFM charges 0.28%. On a $10,000 position that is $18 vs $28 annually, a gap of $10 per year that compounds over a long holding period. On income, QQQ currently yields 0.44% against 3.68% for TAFM.
Holdings Overlap
QQQ and TAFM share 0 holdings out of 323 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, QQQ or TAFM?
QQQ has an expense ratio of 0.18% while TAFM charges 0.28%. QQQ is the cheaper option. On a $10,000 investment, that is $10 per year of difference.
Which performed better, QQQ or TAFM?
Over the past year QQQ returned +26.23% vs +5.50% for TAFM, so QQQ leads on 1-year performance. Over the longest common window we track (3 years), QQQ annualized +13.02% vs +3.47% for TAFM. Past performance does not guarantee future results.
Which is riskier, QQQ or TAFM?
QQQ has been the more volatile fund at 30.6% annualized versus 4.0% for TAFM. Worst drawdown: QQQ -83.0% vs TAFM -4.7%.
Should I hold both QQQ and TAFM?
QQQ and TAFM have a monthly-return correlation of 0.46, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between QQQ and TAFM?
QQQ and TAFM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 323 unique securities.
Which pays a higher dividend, QQQ or TAFM?
QQQ yields 0.44% while TAFM yields 3.68%, so TAFM currently pays the higher dividend yield.
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