VGT vs QQQ

### Overview
VGT (Vanguard Information Technology ETF) tracks the MSCI US Investable Market Information Technology 25/50 Index, providing concentrated exposure to U.S. technology companies across large-, mid-, and small-cap sizes. QQQ (Invesco QQQ Trust) tracks the Nasdaq-100 Index, offering broader growth-oriented exposure to the 100 largest non-financial companies on the Nasdaq, with a heavy but not exclusive tilt toward technology. Both are popular for capturing tech-driven growth, but VGT is a pure-play tech sector fund, while QQQ adds diversification across other innovative sectors like communications and consumer discretionary.

### Key Metrics Comparison

 

Metric	VGT	QQQ
Issuer	Vanguard	Invesco
Inception Date	January 26, 2004	March 10, 1999
Expense Ratio	0.10%	0.20%
AUM (as of early Nov 2025)	~$113 billion	~$409 billion
Number of Holdings	~320	101
Dividend Yield (TTM)	0.40%	0.45%

### Sector Allocation
VGT is almost entirely focused on the technology sector (99%+ allocation), emphasizing software, semiconductors, hardware, and IT services. QQQ has significant tech exposure but diversifies into other growth areas:

Sector	VGT (%)	QQQ (%)
Technology	99	57
Communication Services	0	16
Consumer Discretionary	0	13
Healthcare	0	6
Industrials	0	5
Other	1	3

(Data approximate as of mid-2025; QQQ allocations per recent breakdowns.)

### Top Holdings
Both ETFs share core mega-cap tech names, but QQQ includes non-tech growth stocks like Amazon and Tesla, while VGT sticks to pure tech (e.g., no Amazon, Alphabet, Meta, or Tesla). Top 10 holdings account for ~60% of VGT and ~50% of QQQ, indicating moderate concentration in both.

**VGT Top 10 (approximate weights as of late 2025):**
- Microsoft (MSFT): 18%
- Apple (AAPL): 16%
- Nvidia (NVDA): 14%
- Broadcom (AVGO): 4.5%
- Adobe (ADBE): 2.5%
- Salesforce (CRM): 2%
- Oracle (ORCL): 1.8%
- Cisco (CSCO): 1.5%
- Intel (INTC): 1.2%
- AMD (AMD): 1.1%

**QQQ Top 10 (approximate weights as of late 2025):**
- Microsoft (MSFT): 8.6%
- Apple (AAPL): 8.5%
- Nvidia (NVDA): 7.5%
- Amazon (AMZN): 5.0%
- Broadcom (AVGO): 4.8%
- Meta Platforms (META): 4.5%
- Alphabet (GOOGL): 4.0%
- Tesla (TSLA): 3.5%
- Costco (COST): 2.5%
- Netflix (NFLX): 2.0%

(Weights based on recent analyses; Nvidia, Microsoft, Apple, and Broadcom dominate both.)

### Performance Comparison
VGT has historically outperformed QQQ due to its pure tech focus, especially during bull markets for semiconductors and software, though it can underperform in broader rallies or tech downturns. Returns below are total returns (price appreciation + dividends, as of November 13, 2025). Annualized figures for multi-year periods.

Period	VGT Return	QQQ Return	Notes
YTD 2025	+22.00%	+19.97%	VGT edges out amid AI/semiconductor strength.
1-Year	+22.17%	+19.50%	Consistent VGT lead in recent growth environment.
5-Year (Annualized)	+18.44%	+16.04%	VGT's sector purity shines in post-2020 tech boom.
10-Year (Annualized)	+21.56%	+18.74%	VGT total return ~605% vs. QQQ ~457%; aligns with historical edge.

VGT's higher volatility (standard deviation ~6.4% vs. QQQ's 5.5% over the past year) reflects its sector concentration, but its Sharpe ratio (risk-adjusted return) is comparable (~0.92 for both recently).

### Which to Choose?
- **Choose VGT** if you want low-cost, undiluted tech exposure with higher growth potential and some small/mid-cap diversification (~8% allocation). Ideal for bullish tech outlooks, but riskier in sector slumps.
- **Choose QQQ** for broader Nasdaq growth with built-in diversification (e.g., via Amazon/Meta), lower concentration risk, and massive liquidity/AUM for trading. Better for balanced portfolios.
Both have low fees and strong long-term track records, outperforming the S&P 500. Consider your risk tolerance and portfolio role—many investors hold both for complementary exposure. Always review latest prospectuses for updates.