QQQ vs XLC
Invesco QQQ Trust, Series 1 vs State Street Communication Services Select Sector SPDR ETF
Which is better, QQQ or XLC?
QQQ has been ahead.
XLC has a lower expense ratio. QQQ led over 1Y, 3Y, 5Y and the full window. QQQ is less concentrated, with 46.7% of the fund in its ten largest positions against 70.5%.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | QQQ | XLC |
|---|---|---|
| Expense Ratio | 0.18% | 0.08%Best |
| AUM | $506.1B | $22.7B |
| Dividend Yield | 0.42% | 1.28% |
| Holdings | 321 | 54 |
| YTD Return | +19.30%Best | -4.34% |
| 1Y Return | +22.47%Best | -2.09% |
| 3Y Return (annualized) | +26.18%Best | +18.99% |
| 5Y Return (annualized) | +15.42%Best | +7.74% |
| Volatility (annualized) | 20.3% | 18.8%Best |
| Max Drawdown | -35.1%Best | -46.6% |
| $10,000 over 5 years | $20,484Best | $14,517 |
| Top 10 Weight | 46.7%Best | 70.5% |
| Fund Family | Invesco (US) | SPDR State Street Global Advisors |
| Category | Equity | Equity |
| Style | Large Cap Growth | Large Cap Growth |
| Inception | Mar 10, 1999 | Jun 18, 2018 |
Volatility and max drawdown are measured over the window both funds cover: Jun 19, 2018 to Oct 14, 2026 (8.3 years).
QQQ vs XLC growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view covers the 8.3 years both funds cover.
QQQ vs XLC Performance
Invesco QQQ Trust, Series 1 (QQQ) is an ETF from Invesco (US) and State Street Communication Services Select Sector SPDR ETF (XLC) is an ETF from SPDR State Street Global Advisors. Over the past year QQQ returned +22.47% while XLC returned -2.09%. Year to date, QQQ is up 19.30% versus a loss of 4.34% for XLC.
Over three years, QQQ compounded at +26.18% per year against +18.99% for XLC; over five years the annualized figures are +15.42% and +7.74% respectively. Across the full 8-year window we track, QQQ has the edge at +19.10% annualized vs +10.82%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 20.3% compared with 18.8% for XLC. 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 -35.1% for QQQ and -46.6% for XLC. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.83. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
QQQ charges 0.18% per year while XLC charges 0.08%. On a $10,000 position that is $18 vs $8 annually, a gap of $10 per year that compounds over a long holding period. On income, QQQ currently yields 0.42% against 1.28% for XLC.
Holdings Overlap
12.3% of QQQ's money is in holdings XLC also owns. 60.7% of XLC's money is in holdings QQQ also owns.
The two portfolios partly overlap.
9 positions in common, counted across the 101 positions we hold weights for in QQQ and 25 in XLC, against full books of 321 and 54.
What only one of them owns
Our book lists 16 positions for XLC that do not appear in our book for QQQ (39.3% of the fund), and 84 for QQQ that do not appear in XLC (84.0%).
Some of those will be the same company recorded under a different code in one of the two books, so the real difference in what you would own is no larger than this and may be smaller. We do not name the individual positions here for that reason.
Top Shared Holdings
| Stock | Weight in QQQ | Weight in XLC | Difference |
|---|---|---|---|
| METAMeta Platforms Inc | 3.26% | 18.83% | 15.57% |
| GOOGLAlphabet Inc | 3.05% | 10.19% | 7.14% |
| GOOGAlphabet Inc. C | 2.85% | 8.14% | 5.29% |
| NFLXNetflix, Inc. | 1.21% | 4.60% | 3.39% |
| TMUST-Mobile Usa Inc Esrw Usd Npv Ref Sm#585558 | 0.73% | 4.60% | 3.87% |
| CMCSAComcast Corp. Class A | 0.32% | 4.57% | 4.25% |
| WBDWarner Bros. Discovery, Inc | 0.32% | 4.54% | 4.22% |
| TTWOTake-Two Interactive Software, Inc. | 0.16% | 3.83% | 3.67% |
| APPAppLovin Corp. Com Cl A | 0.37% | 1.36% | 0.99% |
60.7% of XLC is already inside QQQ.
You probably hold more than these two. Add the rest and see how much of the whole book is the same companies twice.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, QQQ or XLC?
QQQ has an expense ratio of 0.18% while XLC charges 0.08%. XLC is the cheaper option, by $10 a year on a $10,000 investment.
Which performed better, QQQ or XLC?
Over the past year QQQ returned +22.47% vs -2.09% for XLC, so QQQ leads on 1-year performance. Over the longest common window we track (8 years), QQQ annualized +19.10% vs +10.82% for XLC. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, QQQ or XLC?
QQQ has been the more volatile fund at 20.3% annualized versus 18.8% for XLC. Worst drawdown: QQQ -35.1% vs XLC -46.6%.
Should I hold both QQQ and XLC?
QQQ and XLC have a monthly-return correlation of 0.83, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
What is the holdings overlap between QQQ and XLC?
60.7% of XLC's money is in holdings QQQ also owns. 60.7% of XLC's is in holdings QQQ also owns. They hold 9 positions in common, counted across the 101 positions we hold weights for in QQQ and 25 in XLC.
Which pays a higher dividend, QQQ or XLC?
QQQ yields 0.42% while XLC yields 1.28%, so XLC currently pays the higher dividend yield.
Is XLC better than QQQ?
XLC has a lower expense ratio. QQQ led over 1Y, 3Y, 5Y and the full window. QQQ is less concentrated, with 46.7% of the fund in its ten largest positions against 70.5%. Which one suits a particular account depends on what it is for. This is information, not a recommendation.