QQQ vs VTIP
Invesco QQQ Trust, Series 1 vs Vanguard Short-Term Inflation-Protected Securities ETF
Quick Verdict
VTIP has a lower expense ratio. QQQ delivered stronger 1-year returns. QQQ offers more diversification with 103 holdings.
Side-by-Side Comparison
| Metric | QQQ | VTIP | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 0.03% | |
| AUM | $455.8B | $19.3B | |
| Dividend Yield | 0.41% | 3.60% | |
| Holdings | 108 | 27 | |
| YTD Return | +17.85% | +1.89% | |
| 1Y Return | +26.45% | +2.97% | |
| 3Y Return (annualized) | +26.07% | +5.46% | |
| 5Y Return (annualized) | +15.16% | +3.38% | |
| Volatility (annualized) | 30.6% | 2.4% | |
| Max Drawdown | -83.0% | -7.1% | |
| Fund Family | Invesco (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Mar 10, 1999 | Oct 12, 2012 |
QQQ vs VTIP Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and Vanguard Short-Term Inflation-Protected Securities ETF (VTIP) is a ETF from Vanguard (US). Over the past year QQQ returned +26.45% while VTIP returned +2.97%. Year to date, QQQ is up 17.85% versus a gain of 1.89% for VTIP.
Over three years, QQQ compounded at +26.07% per year against +5.46% for VTIP; over five years the annualized figures are +15.16% and +3.38% respectively. Across the full 14-year window we track, QQQ has the edge at +13.09% annualized vs +1.58%. 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 2.4% for VTIP. 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 -7.1% for VTIP. 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 0.43. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
QQQ charges 0.18% per year while VTIP 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 3.60% for VTIP.
Holdings Overlap
QQQ and VTIP share 0 holdings out of 126 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 VTIP?
QQQ has an expense ratio of 0.18% while VTIP charges 0.03%. VTIP is the cheaper option. On a $10,000 investment, that is $15 per year of difference.
Which performed better, QQQ or VTIP?
Over the past year QQQ returned +26.45% vs +2.97% for VTIP, so QQQ leads on 1-year performance. Over the longest common window we track (14 years), QQQ annualized +13.09% vs +1.58% for VTIP. Past performance does not guarantee future results.
Which is riskier, QQQ or VTIP?
QQQ has been the more volatile fund at 30.6% annualized versus 2.4% for VTIP. Worst drawdown: QQQ -83.0% vs VTIP -7.1%.
Should I hold both QQQ and VTIP?
QQQ and VTIP have a monthly-return correlation of 0.43, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between QQQ and VTIP?
QQQ and VTIP share 0 common holdings with a 0.0% weight overlap. Combined, they hold 126 unique securities.
Which pays a higher dividend, QQQ or VTIP?
QQQ yields 0.41% while VTIP yields 3.60%, so VTIP currently pays the higher dividend yield.
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