QQQ vs VCIT
Invesco QQQ Trust, Series 1 vs Vanguard Intermediate Term Corporate Bond ETF
Quick Verdict
VCIT has a lower expense ratio. QQQ delivered stronger 1-year returns. VCIT offers more diversification with 2019 holdings.
Side-by-Side Comparison
| Metric | QQQ | VCIT | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 0.03% | |
| AUM | $455.8B | $67.3B | |
| Dividend Yield | 0.41% | 4.77% | |
| Holdings | 108 | 2,253 | |
| YTD Return | +18.31% | -0.70% | |
| 1Y Return | +25.37% | +2.15% | |
| 3Y Return (annualized) | +25.79% | +6.06% | |
| 5Y Return (annualized) | +15.20% | +0.78% | |
| Volatility (annualized) | 30.6% | 6.0% | |
| Max Drawdown | -83.0% | -20.7% | |
| Fund Family | Invesco (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Mar 10, 1999 | Nov 19, 2009 |
QQQ vs VCIT Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and Vanguard Intermediate Term Corporate Bond ETF (VCIT) is a ETF from Vanguard (US). Over the past year QQQ returned +25.37% while VCIT returned +2.15%. Year to date, QQQ is up 18.31% versus a loss of 0.70% for VCIT.
Over three years, QQQ compounded at +25.79% per year against +6.06% for VCIT; over five years the annualized figures are +15.20% and +0.78% respectively. Across the full 17-year window we track, QQQ has the edge at +13.10% annualized vs +1.73%. 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 6.0% for VCIT. 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 -20.7% for VCIT. 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 0.44. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
QQQ charges 0.18% per year while VCIT charges 0.03%. On a $10,000 position that is $18 vs $3 annually, a gap of $15 per year that compounds over a long holding period. On income, QQQ currently yields 0.41% against 4.77% for VCIT.
Holdings Overlap
QQQ and VCIT share 0 holdings out of 2122 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 VCIT?
QQQ has an expense ratio of 0.18% while VCIT charges 0.03%. VCIT is the cheaper option. On a $10,000 investment, that is $15 per year of difference.
Which performed better, QQQ or VCIT?
Over the past year QQQ returned +25.37% vs +2.15% for VCIT, so QQQ leads on 1-year performance. Over the longest common window we track (17 years), QQQ annualized +13.10% vs +1.73% for VCIT. Past performance does not guarantee future results.
Which is riskier, QQQ or VCIT?
QQQ has been the more volatile fund at 30.6% annualized versus 6.0% for VCIT. Worst drawdown: QQQ -83.0% vs VCIT -20.7%.
Should I hold both QQQ and VCIT?
QQQ and VCIT have a monthly-return correlation of 0.44, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between QQQ and VCIT?
QQQ and VCIT share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2122 unique securities.
Which pays a higher dividend, QQQ or VCIT?
QQQ yields 0.41% while VCIT yields 4.77%, so VCIT currently pays the higher dividend yield.
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