QQQ vs. IVE: What’s The Difference?

The Invesco QQQ Trust (QQQ) and the iShares S&P 500 Value ETF (IVE) are both among the Top 100 ETFs. QQQ is a Invesco Large Growth fund and IVE is a iShares Large Value fund. So, what’s the difference between QQQ and IVE? And which fund is better?

The expense ratio of QQQ is 0.02 percentage points higher than IVE’s (0.2% vs. 0.18%). QQQ also has a higher exposure to the technology sector and a higher standard deviation. Overall, QQQ has provided higher returns than IVE over the past ten years.

In this article, we’ll compare QQQ vs. IVE. We’ll look at holdings and annual returns, as well as at their portfolio growth and performance. Moreover, I’ll also discuss QQQ’s and IVE’s risk metrics, industry exposure, and fund composition and examine how these affect their overall returns.

Summary

QQQ IVE
Name Invesco QQQ Trust iShares S&P 500 Value ETF
Category Large Growth Large Value
Issuer Invesco iShares
AUM 174.51B 22.4B
Avg. Return 21.27% 11.68%
Div. Yield 0.49% 1.88%
Expense Ratio 0.2% 0.18%

The Invesco QQQ Trust (QQQ) is a Large Growth fund that is issued by Invesco. It currently has 174.51B total assets under management and has yielded an average annual return of 21.27% over the past 10 years. The fund has a dividend yield of 0.49% with an expense ratio of 0.2%.

The iShares S&P 500 Value ETF (IVE) is a Large Value fund that is issued by iShares. It currently has 22.4B total assets under management and has yielded an average annual return of 11.68% over the past 10 years. The fund has a dividend yield of 1.88% with an expense ratio of 0.18%.

QQQ’s dividend yield is 1.39% lower than that of IVE (0.49% vs. 1.88%). Also, QQQ yielded on average 9.59% more per year over the past decade (21.27% vs. 11.68%). The expense ratio of QQQ is 0.02 percentage points higher than IVE’s (0.2% vs. 0.18%).

Fund Composition

Industry Exposure

QQQ vs. IVE - Industry Exposure

QQQ IVE
Technology 45.46% 9.41%
Industrials 2.61% 12.19%
Energy 0.0% 5.43%
Communication Services 19.55% 6.4%
Utilities 0.89% 4.82%
Healthcare 7.04% 15.4%
Consumer Defensive 4.68% 9.23%
Real Estate 0.0% 4.38%
Financial Services 2.51% 22.06%
Consumer Cyclical 17.27% 7.68%
Basic Materials 0.0% 2.99%

The Invesco QQQ Trust (QQQ) has the most exposure to the Technology sector at 45.46%. This is followed by Communication Services and Consumer Cyclical at 19.55% and 17.27% respectively. Real Estate (0.0%), Energy (0.0%), and Utilities (0.89%) only make up 0.89% of the fund’s total assets.

QQQ’s mid-section with moderate exposure is comprised of Financial Services, Industrials, Consumer Defensive, Healthcare, and Consumer Cyclical stocks at 2.51%, 2.61%, 4.68%, 7.04%, and 17.27%.

The iShares S&P 500 Value ETF (IVE) has the most exposure to the Financial Services sector at 22.06%. This is followed by Healthcare and Industrials at 15.4% and 12.19% respectively. Real Estate (4.38%), Utilities (4.82%), and Energy (5.43%) only make up 14.63% of the fund’s total assets.

IVE’s mid-section with moderate exposure is comprised of Communication Services, Consumer Cyclical, Consumer Defensive, Technology, and Industrials stocks at 6.4%, 7.68%, 9.23%, 9.41%, and 12.19%.

QQQ is 36.05% more exposed to the Technology sector than IVE (45.46% vs 9.41%). QQQ’s exposure to Communication Services and Consumer Cyclical stocks is 13.15% higher and 9.59% higher respectively (19.55% vs. 6.4% and 17.27% vs. 7.68%). In total, Real Estate, Energy, and Utilities also make up 13.74% less of the fund’s holdings compared to IVE (0.89% vs. 14.63%).

Holdings

QQQ - Holdings

QQQ Holdings Weight
Apple Inc 11.0%
Microsoft Corp 9.82%
Amazon.com Inc 8.35%
Facebook Inc Class A 4.01%
Facebook Inc A 4.01%
Alphabet Inc Class C 3.9%
Tesla Inc 3.9%
NVIDIA Corp 3.65%
Alphabet Inc Class A 3.53%
Alphabet Inc A 3.53%

QQQ’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Facebook Inc A at 11.0%, 9.82%, 8.35%, 4.01%, and 4.01%.

Alphabet Inc Class C (3.9%), Tesla Inc (3.9%), and NVIDIA Corp (3.65%) have a slightly smaller but still significant weight. Alphabet Inc Class A and Alphabet Inc A are also represented in the QQQ’s holdings at 3.53% and 3.53%.

IVE - Holdings

IVE Holdings Weight
Berkshire Hathaway Inc Class B 3.05%
JPMorgan Chase & Co 2.65%
The Walt Disney Co 1.85%
Bank of America Corp 1.67%
Johnson & Johnson 1.57%
Exxon Mobil Corp 1.41%
Pfizer Inc 1.38%
Cisco Systems Inc 1.35%
Verizon Communications Inc 1.33%
Intel Corp 1.25%

IVE’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, The Walt Disney Co, Bank of America Corp, and Johnson & Johnson at 3.05%, 2.65%, 1.85%, 1.67%, and 1.57%.

Exxon Mobil Corp (1.41%), Pfizer Inc (1.38%), and Cisco Systems Inc (1.35%) have a slightly smaller but still significant weight. Verizon Communications Inc and Intel Corp are also represented in the IVE’s holdings at 1.33% and 1.25%.

Performance

Annual Returns

QQQ vs. IVE - Annual Returns

Year QQQ IVE
2020 48.6% 1.24%
2019 39.12% 31.71%
2018 -0.14% -9.09%
2017 32.7% 15.19%
2016 7.01% 17.17%
2015 9.54% -3.24%
2014 19.12% 12.14%
2013 36.6% 31.69%
2012 18.09% 17.45%
2011 3.44% -0.63%
2010 19.89% 14.9%

QQQ had its best year in 2020 with an annual return of 48.6%. QQQ’s worst year over the past decade yielded -0.14% and occurred in 2018. In most years the Invesco QQQ Trust provided moderate returns such as in 2012, 2014, and 2010 where annual returns amounted to 18.09%, 19.12%, and 19.89% respectively.

The year 2019 was the strongest year for IVE, returning 31.71% on an annual basis. The poorest year for IVE in the last ten years was 2018, with a yield of -9.09%. Most years the iShares S&P 500 Value ETF has given investors modest returns, such as in 2014, 2010, and 2017, when gains were 12.14%, 14.9%, and 15.19% respectively.

Portfolio Growth

QQQ vs. IVE - Portfolio Growth

Fund Initial Balance Final Balance CAGR
QQQ $10,000 $76,522 21.27%
IVE $10,000 $31,350 11.68%

A $10,000 investment in QQQ would have resulted in a final balance of $76,522. This is a profit of $66,522 over 11 years and amounts to a compound annual growth rate (CAGR) of 21.27%.

With a $10,000 investment in IVE, the end total would have been $31,350. This equates to a $21,350 profit over 11 years and a compound annual growth rate (CAGR) of 11.68%.

QQQ’s CAGR is 9.59 percentage points higher than that of IVE and as a result, would have yielded $45,172 more on a $10,000 investment. Thus, QQQ outperformed IVE by 9.59% annually.


Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

2) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

3) If you are interested in crypto, check out Gemini. I've started allocating a small amount of assets to the growing crypto space and Gemini has just been a breeze to use. Once you register, make sure to also open an Active Trader account to buy crypto at the lowest fees on the market (just 0.03%!).

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

Leave a Reply