Investing Basics

How QQQ can fit into your portfolio

artist considering how to complete a painting like an investor wondering how qqq can fit into a portfolio
Key takeaways
  • QQQ provides diversified exposure to the 100 largest nonfinancial companies listed on the Nasdaq, offering investors access to market-leading growth companies without individual stock selection.
  • The fund has historically outperformed the S&P 500 but comes with higher volatility and a focus on the Information Technology sector.1
  • QQQ may serve multiple portfolio roles from large-cap growth allocation to thematic investing, making it something investors with long-term horizons who can tolerate increased price fluctuations might want to consider.

Invesco QQQ ETF is often chosen by investors seeking exposure to leading growth companies.

This article explores QQQ’s potential benefits and how it can be strategically integrated into investment portfolios, highlighting its features, practical applications, and considerations for different investor types.

Why consider QQQ?

In a nutshell, QQQ offers exposure to the Nasdaq-100® Index, which contains the 100 largest nonfinancial companies listed on the Nasdaq. With a track record of more than 25 years and assets of $363.0 billion, QQQ is the fifth-largest ETF in the U.S. based on AUM.2

Over the past 10 years, QQQ has often outpaced the S&P 500® Index—a broad U.S. equity benchmark. This performance reflects its focus on innovative, market-leading companies.

QQQ has historically outperformed over the past decade

Source: Bloomberg L.P., 10yr performance as of 8/31/25.

Standardized performance - Fund performance shown at NAV. Performance quoted is past performance and cannot guarantee comparable future results; current performance may be higher or lower. Visit invesco.com/performance for the most recent month-end performance. Investment returns and principal value will vary; you may have a gain or loss when you sell shares. Fund performance reflects fee waivers, absent which, performance data quoted would have been lower. Invesco QQQ’s total expense ratio is 0.20%. Index performance does not represent fund performance. Please keep in mind that high, double-digit and/or triple-digit returns are highly unusual and cannot be sustained.

How QQQ can be used in a portfolio

QQQ can serve multiple roles depending on investors’ investment strategy and risk tolerance.

  • Large-cap or core exposure: As a large-cap growth allocation, it provides exposure to established companies with strong growth potential. For investors seeking core equity exposure, QQQ offers a focused approach to market-leading firms.
  • Exposure to market leaders: QQQ’s holdings are dominated by influential companies like Apple, Microsoft, and Nvidia, with top sectors including Information Technology and Consumer Discretionary. These companies often drive market trends and potentially offer investors exposure to long-term structural growth trends.
  • Thematic exposure without stock picking: QQQ's focus on the Nasdaq-100 Index allows investors to access companies at the forefront of trends like artificial intelligence (AI) and digital transformation without the need to research and select individual stocks. This may be particularly valuable for investors who want exposure to technology-focused companies but prefer the diversification of an ETF structure.
Key considerations and trade-offs

While QQQ's focus on innovation and market-leading companies offers compelling growth potential, it's important to understand the trade-offs that come with this approach.

  • Higher potential volatility: Although QQQ has outperformed the S&P 500 Index over the past 10 years, it was more volatile.3 A long-term strategy may help, as staying invested may help mitigate short-term volatility and benefit from the companies’ potential sustained growth.
  • Tech sector focus: Investors should be aware QQQ had 62.42%4 of its portfolio in the Information Technology sector, in part because its tracking index follows the 100 largest nonfinancial companies on the Nasdaq, home to some of the world’s largest innovative tech leaders.
The bottom line

QQQ may be an attractive vehicle for investors seeking exposure to leading growth companies and innovation trends. And it can be a versatile portfolio addition for large-cap growth, core equity exposure, or thematic investing without stock selection.

As always, though, investors should carefully consider their investment goals and risk tolerance. QQQ’s historical volatility means investors should be prepared for price swings. A long-term investment horizon can help ride out volatility while potentially benefiting from innovative companies' growth.

 

  • 1

    Based on cumulative NAV performance.

  • 2

    Bloomberg L.P. as of 8/31/25.

  • 3

    Based on cumulative NAV performance.

  • 4

    Bloomberg L.P. as of 8/31/25.

How to invest in QQQ

Select the option that best describes you, or view the QQQ Product Details to take a deeper dive.

success failure

Access innovation

Sign up to learn more about Invesco QQQ. You’ll receive regular performance updates and insights.

Access innovation

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

When you interact with us, we may collect information about you which constitutes personal data under applicable laws and regulations. Our privacy notice explains how we use and protect your personal data.

Sign up for the Innovation Newsletter
Learn more about the potential advantages of Invesco QQQ.