QQQ vs IVV: Side-by-Side ETF Comparison

QQQ vs IVV boils down to growth focus vs broad market exposure - QQQ's 51% tech allocation helped it deliver 17.5% returns last year but costs 0.20%, while IVV spreads your money across the entire S&P 500 for just 0.03% and offers a higher 1.17% yield. The choice is essentially whether you want to bet heavily on big tech or own a slice of the whole US large-cap market.

Table of Content

• Annual & Cumulative Returns
• Risk Metrics
• Dividend Yield & Growth
• Fees & Liquidity
• ETF Composition: Asset Classes
• Regional Allocation
• Sector Weights
• Top 10 Holdings
• Valuation & Growth Metrics
• Which ETF Fits Your Portfolio?

ETF Issuers & Investment Objective

Invesco's QQQ tracks the Nasdaq-100, which means you're buying a tech-heavy slice of the market - over half the portfolio sits in technology names, with another 16% in communication services. This concentration isn't accidental. The fund's mandate is to mirror the Nasdaq-100 exactly, so when Apple or Microsoft grows as a percentage of that index, QQQ automatically increases its weighting. At 0.20% in fees, you're paying more than six times what IVV charges for this focused exposure.

BlackRock's IVV takes the opposite approach by owning the entire S&P 500, giving you every large US company from tech giants to banks to consumer staples. The portfolio spreads risk across 500 stocks instead of 100, with technology still the biggest sector but at a more modest 34% weighting. This broader diversification shows up in the numbers - the fund yields 1.17% versus QQQ's 0.46%, though growth investors might find the trade-off worthwhile given QQQ's recent 17.5% annual return compared to IVV's 14.4%.

Annual & Cumulative Returns

QQQ's tech-heavy approach has delivered substantially higher returns over most time periods, with the three-year gap particularly striking at 29.94% versus IVV's 21.52%. The difference narrows over five years but remains meaningful, and even the recent one-year advantage of 17.5% to 14.43% shows QQQ maintaining its edge despite 2023's market volatility.

The catch is that these superior returns come with the territory of betting heavily on growth stocks. QQQ's 51% technology allocation means you're essentially doubling down on the sector compared to IVV's more balanced 34% weighting. While this concentration has historically paid off - especially during the decade-long tech boom that produced QQQ's 20.51% annual return versus IVV's still-respectable 15.69% - it also means more exposure when tech stumbles. The minimal difference in YTD performance (1.37% versus 1.07%) suggests both ETFs are moving in lockstep during current market conditions, despite their underlying portfolio differences.

Risk Metrics

QQQ's volatility runs about 15.6% over both one- and three-year windows, roughly four to five points higher than IVV's 11-12%. That gap translates into noticeably wider daily swings - during market stress you'll feel the difference in your account balance. The tech-heavy portfolio simply bounces around more than the diversified S&P 500, which spreads risk across sectors like financials and healthcare that tend to move independently of each other.

Yet QQQ has compensated investors for that extra turbulence. Its Sharpe ratio of 1.61 over three years beats IVV's 1.4, meaning each unit of risk taken generated slightly better returns. The numbers suggest QQQ works best for investors who can stomach the ride without selling at the wrong time. If market swings make you nervous or you need the money within a few years, IVV's smoother path might help you stay the course.

Dividend Yield & Growth

QQQ's 0.46% yield lands well below IVV's 1.17%, a gap that flows directly from what each fund owns. Tech giants like Apple and Microsoft dominate QQQ's basket, and those companies prefer pumping cash into R&D and buybacks rather than mailing dividend checks. The broader S&P 500 that IVV tracks still leans on tech for growth, but its 12.6% financial-services slice - packed with banks that regulators nudge toward steady payouts - helps push the yield comfortably above 1%.

Both ETFs pay quarterly, so the cash shows up on the same schedule. What differs is what that income stream means for your total return. QQQ investors essentially trade current income for faster compounding; the fund's 17.5% one-year gain beats IVV's 14.4% even after factoring the skimpy yield. If you're spending the dividends, IVV hands you roughly two and a half times more cash per dollar invested. If you're reinvesting, QQQ's lower yield leaves more money in growth mode, though you'll need to stomach the tech sector's sharper swings along the way.

Fees & Liquidity

The gap here is impossible to ignore: IVV charges 0.03%, QQQ asks 0.20%. Put real money on it and the difference adds up fast. On a $100 k position held for ten years, the lower fee saves you roughly $1,800 even before compounding is counted. QQQ’s price buys you a tech-heavy Nasdaq-100 slice; IVV gives you the whole S&P 500 at index-fund wholesale cost. If the goal is simply to own large-cap U.S. stocks for decades, that extra 17 basis points is money you never get back.

Trading spreads tell a similar story. Both ETFs trade millions of shares daily, so you’re usually looking at a penny or two of market width, but QQQ’s popularity can ironically work against you. Heavy retail volume around tech earnings or Fed days can widen spreads for a few minutes, whereas IVV’s broader basket tends to price more smoothly. Unless you’re timing the market, the liquidity difference is minor, yet the fee gap is permanent. Pick QQQ only if you specifically want Nasdaq torque; otherwise the cheaper horse is clearly IVV.

ETF Composition: Asset Classes

QQQ keeps almost nothing in cash - just 0.07% - and spreads that tiny remainder between domestic and international names. With 96.3% parked in U.S. equities, the fund is essentially a pure play on American large-cap growth. IVV is even more domestic, devoting 99.2% to U.S. stocks and holding a hair more cash at 0.27%. For investors who view the S&P 500 as the default market portfolio, IVV’s allocation is about as clean as it gets.

The gap looks small on paper, yet it matters. QQQ’s 3.6% foreign stub comes from multinationals like ASML and PDD that list in New York but earn most of their revenue abroad, giving the fund a slight international tilt without the currency headache of true overseas ETFs. IVV’s sub-1% non-U.S. weighting keeps currency and geopolitical noise to a minimum, but it also means you’re betting almost entirely on the domestic economy. If you want your equity sleeve to mirror the global tech supply chain, QQQ offers a whisper of that exposure; if you prefer a textbook U.S. large-cap core, IVV’s 99% domestic stake is hard to beat.

Regional Allocation

QQQ keeps almost all its chips on the U.S. table 97.6% North America because the Nasdaq-100 is basically a who’s-who of domestic tech giants. The leftover 2.4% is sprinkled across a handful of London listings, European subsidiaries, and the odd emerging-market ADR, but those positions are rounding errors next to the Apple-and-Microsoft core. IVV is even more domestic, with 99.5% parked in North America; the S&P 500 simply doesn’t leave much room for overseas listings, so the fund’s foreign weight is one-third of QQQ’s already-small slice.

For investors, this means both ETFs move almost in lock-step with the U.S. dollar and domestic economic cycles don’t expect either one to cushion you if Wall Street sneezes. QQQ’s micro-dose of emerging Asia (0.38%) and Latin America (0.58%) gives it a whisker of revenue diversification, but the difference is too small to sway portfolio construction. Bottom line: if you want true regional balance you’ll need to pair either fund with something explicitly international; on their own, both are essentially pure U.S. bets.

Sector Weights

QQQ's sector tilt is unmistakable: more than half the fund sits in technology stocks, with another 16% in communication services. That 51% tech weight is roughly seventeen percentage points higher than IVV's already-hefty 34%, and the gaps elsewhere are just as stark. IVV carries a 12.6% slice of financial services; QQQ barely registers at 0.3%. The same pattern shows up in healthcare (IVV 9.6%, QQQ 5.0%) and energy (IVV 3.1%, QQQ 0.5%). In short, QQQ is a concentrated bet on growth-oriented sectors, while IVV spreads the same bets across a broader map.

What this means for a portfolio is risk texture. QQQ's narrow focus can amplify gains when tech rallies, but it also leaves the fund exposed if sentiment shifts away from growth. IVV's wider sector net smooths some of that bumpiness, though it won't capture the full upside of a tech surge. Investors who already own broad-market funds elsewhere might use QQQ as a satellite position, while those looking for a one-ticket core holding often find IVV's balance easier to hold through different market cycles.

Top 10 Holdings

The top five holdings tell a clear story about concentration risk. QQQ's biggest positions make up 30.7% of the fund, led by NVIDIA at 8.6%. That's nearly one-third of your money riding on just five tech giants. IVV spreads things thinner - the same five companies account for 26.6% of assets, with NVIDIA commanding a smaller 7.6% weight. Both funds share the same mega-cap leaders, but QQQ's tech focus amplifies their impact.

What's striking is how similar the names are despite different mandates. You'll find NVIDIA, Apple, Microsoft and Amazon in both top fives, just with varying weights. The key difference? QQQ excludes Alphabet's Class A shares entirely, while IVV includes them at 3.3% to round out its top five. This creates a subtle but meaningful distinction: QQQ investors get more concentrated exposure to fewer names, while IVV offers broader mega-cap representation across the S&P 500.

Valuation & Growth Metrics

QQQ trades at a clear premium across every valuation yardstick: 25.1 times earnings versus 22.3 for IVV, 6.4 times book compared with 4.5, and 5.0 times sales next to 3.2. That markup isn’t fantasy. The Nasdaq-heavy basket has delivered faster profit expansion 15.8 % annual earnings growth over the past five years against 10.3 % for the broad market and still edges IVV on forward-looking growth forecasts (10.8 % vs 10.5 %). Investors are paying up for a portfolio that has historically turned innovation into faster compounding.

The catch is that the extra growth isn’t dramatically higher, yet the valuation cushion is noticeably thinner. A market sour on tech can punish those multiples faster than the underlying companies can grow into them, while IVV’s more modest price tags and wider sector mix offer a softer landing. If you want the higher-octane trajectory and accept bumpier drawdowns, QQQ’s numbers justify the fee. If you’d rather not pay 12-15 % more for each dollar of earnings, IVV gives you most of the growth with a bigger margin of safety.

Which ETF Fits Your Portfolio?

QQQ makes sense if you want a concentrated bet on the Nasdaq-100’s growth engine: technology makes up half the fund and the 17.5% one-year return shows what that tilt can do when the sector runs. You’ll pay 0.20% a year for the privilege and collect only a 0.46% dividend, so treat it like a high-octane satellite rather than a core holding.

IVV gives you the whole S&P 500 at one-seventh the fee 0.03% and a payout that’s nearly triple QQQ’s at 1.17%. The 14.43% one-year gain trails QQQ, but the broader 34% tech weight and 22.3 P/E suggest less single-sector risk. If you want a cheap, set-and-forget U.S. anchor, IVV fits; if you’re comfortable with a narrower, pricier growth slice, QQQ can play a supporting role.

If you want to have look at other ETF comparisons, check out this: Fund Overlap Tool

Data sources: The data has been obtained from the ETF provider's website and ETF fact sheet.