QQQ vs VCSH
Invesco QQQ Trust, Series 1 vs Vanguard Short Term Corporate Bond ETF
Quick Verdict
VCSH has a lower expense ratio. QQQ delivered stronger 1-year returns. VCSH offers more diversification with 3,023 holdings.
Side-by-Side Comparison
| Metric | QQQ | VCSH | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 0.03% | |
| AUM | $496.3B | $52.0B | |
| Dividend Yield | 0.44% | 4.46% | |
| Holdings | 108 | 3,023 | |
| YTD Return | +16.23% | +1.13% | |
| 1Y Return | +26.23% | +3.19% | |
| 3Y Return (annualized) | +25.75% | +5.74% | |
| 5Y Return (annualized) | +14.78% | +2.39% | |
| Volatility (annualized) | 30.6% | 2.6% | |
| Max Drawdown | -83.0% | -12.9% | |
| Fund Family | Invesco (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Mar 10, 1999 | Nov 19, 2009 |
QQQ vs VCSH Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and Vanguard Short Term Corporate Bond ETF (VCSH) is a ETF from Vanguard (US). Over the past year QQQ returned +26.23% while VCSH returned +3.19%. Year to date, QQQ is up 16.23% versus a gain of 1.13% for VCSH.
Over three years, QQQ compounded at +25.75% per year against +5.74% for VCSH; over five years the annualized figures are +14.78% and +2.39% respectively. Across the full 17-year window we track, QQQ has the edge at +13.02% annualized vs +1.31%. 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 2.6% for VCSH. 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 -12.9% for VCSH. 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 VCSH 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 0.44% against 4.46% for VCSH.
Holdings Overlap
QQQ and VCSH share 0 holdings out of 659 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 VCSH?
QQQ has an expense ratio of 0.18% while VCSH charges 0.03%. VCSH is the cheaper option. On a $10,000 investment, that is $15 per year of difference.
Which performed better, QQQ or VCSH?
Over the past year QQQ returned +26.23% vs +3.19% for VCSH, so QQQ leads on 1-year performance. Over the longest common window we track (17 years), QQQ annualized +13.02% vs +1.31% for VCSH. Past performance does not guarantee future results.
Which is riskier, QQQ or VCSH?
QQQ has been the more volatile fund at 30.6% annualized versus 2.6% for VCSH. Worst drawdown: QQQ -83.0% vs VCSH -12.9%.
Should I hold both QQQ and VCSH?
QQQ and VCSH 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 VCSH?
QQQ and VCSH share 0 common holdings with a 0.0% weight overlap. Combined, they hold 659 unique securities.
Which pays a higher dividend, QQQ or VCSH?
QQQ yields 0.44% while VCSH yields 4.46%, so VCSH currently pays the higher dividend yield.
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