These debt instruments make TQQQ an aggressive portfolio. Here are TQQQ and QQQ holdings side-by-side:įurther, it’s important to note that being leverage funds, they have invested in the Treasury bills and other debt instruments. First, TQQQ includes cash positions, while QQQ does not. Let’s analyze the holding structure for TQQQ and QQQ. In the long term, both ETFs have performed well. So, it’s proven that TQQQ is three times more aggressive and more volatile than QQQ. As we can analyze, the quarterly loss of TQQQ is almost threefold. TQQQ seeks to generate three times the return of QQQ.įurther, the loss potential of TQQQ is similar. The monthly return generated by QQQ is 6.94%, and the return by TQQQ is 18.63%. The monthly analysis reveals that the return generated by TQQQ is three times that of QQQ. The given chart shows the performance of TQQQ and QQQ: However, it helps to understand the nature of the security. Although, past performance does not reflect future performance. Understanding the performance of ETFs is an excellent idea to understand earning potential of the security. Let’s continue our detailed comparison with the performance of these ETFs. In addition, TQQ charges a higher amount as a management fee. TQQQ is not suitable for long-term retention as it’s a speculative instrument, while QQQ is comparatively stable. TQQQ requires a lower initial investment to reach specific money goals as it’s aggressive. The element of risk carried by TQQQ is three times as it seeks to generate a return threefold of a traditional QQQ. TQQQ and QQQ differ in risk, capital, timeline, strategy, and price. The managing company of TQQQ is Proshares, while the managing company for QQQ is Invesco. This means TQQQ has a higher management fee and higher volatility. The expense ratio of TQQQ is 0.95%, while QQQ has an expense ratio of 0.20%. Therefore, you can expect higher volatility from TQQQ. So, it’s essential to understand that TQQQ contains an additional leverage risk.įurther, there is a compounding element in terms of return calculation. Hence, it’s only suitable for investors with a higher level of risk tolerance.
TQQQ stands for triple QQQ, which means it seeks to earn a return three times that of QQQ. Hence, a daily trader should invest in TQQQ. QQQ is highly liquid and actively traded in the market. On the other hand, TQQQ is suitable for someone who intends to trade. However, both of these ETFs track the NASDAQ 100.įurther, QQQ is more suitable for long-term investors that want exposure to NASDAQ 100. TQQQ uses debt and financial derivatives to seek higher returns. The primary difference between TQQQ and QQQ is that TQQQ is a leveraged ETF while QQQ is non-leveraged. Why Is The Expense Ratio Higher For TQQQ? TQQQ vs QQQ.What Are The Cons Of Investing In TQQQ?.What Are The Pros Of Investing In TQQQ?.Does TQQQ Generate The Return Dependent On The NASDAQ?.More information on MSCI ESG Fund Metrics, provided by MSCI ESG Research LLC, can be found at. Neither MSCI ESG nor any of its affiliates or any third party involved in or related to creating any Information makes any express or implied warranties, representations or guarantees, and in no event will MSCI ESG or any such affiliate or third party have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) relating to any Information. All Information is provided solely for your internal use, and may not be reproduced or redisseminated in any form without express prior written permission from MSCI. The Information is provided “as is” and the user of the Information assumes the entire risk of any use it may make or permit to be made of the Information. None of the Information can be used to determine which securities to buy or sell or when to buy or sell them. None of the information constitutes an offer to buy or sell, or a promotion or recommendation of, any security, financial instrument or product or trading strategy, nor should it be taken as an indication or guarantee of any future performance, analysis, forecast or prediction. MSCI ESG materials have not been submitted, to nor received approval from, the US SEC or any other regulatory body. MSCI ESG is a Registered Investment Adviser under the Investment Advisers Act of 1940. MSCI ESG Research LLC’s (“MSCI ESG”) Fund Metrics products (the “Information”) provide environmental, social and governance data with respect to underlying securities within more than 23,000 multi-asset class Mutual Funds and ETFs globally.
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