VOO vs. QQQ: Is S&P 500 Stability or Tech-Focused Growth the Better Choice for Investors? | The Motley Fool

The Invesco QQQ Trust, Series 1 ETF ( QQQ +1.27%) and the Vanguard S&P 500 ETF ( VOO +0.89%) are two of the most popular exchange-traded funds. Each offers exposure to large-cap U.S. stocks , but with distinct approaches. QQQ tracks the NASDAQ-100 Index, which is heavily weighted toward technology, while VOO follows the S&P 500 Index. This comparison highlights key differences in cost, performance, risk, and portfolio construction to help investors decide which ETF may appeal more to their goals. Snapshot (cost & size) Metric QQQ VOO Issuer Invesco Vanguard Expense ratio 0.20% 0.03% 1-yr return (as of Dec. 18, 2025) 13.66% 11.99% Dividend yield 0.46% 1.12% Beta (5Y monthly) 1.19 1.00 AUM $403 billion $1.5 trillion Beta measures price volatility relative to the S&P 500. The 1-yr return represents total return over the trailing 12 months. VOO stands out as the more affordable option, with a much lower expense ratio compared to QQQ. VOO also offers a higher dividend yield, which may appeal to income-focused investors. Performance & risk comparison Metric QQQ VOO Max drawdown (5 y) -35.12% -24.53% Growth of $1,000 over 5 years $1,959 $1,819 What's inside VOO aims to replicate the S&P 500 Index, providing diversified exposure across 505 holdings. Its top sectors include technology (making up 37% of the fund's total assets), financial services (13%), and consumer cyclical (11%). Its largest positions are Nvidia , Apple , and Microsoft . With a fund age of more than 15 years, VOO offers a seasoned, broad-market approach without notable quirks or unusual restrictions. QQQ, on the other hand, is concentrated in the NASDAQ-100, with 101 holdings and a strong tilt toward technology (55%), followed by communication services (17%), and consumer cyclicals (13%). Its top three holdings match VOO's, but they each make up a larger percentage of the portfolio -- making it more top-heavy and growth-oriented than VOO. For more guidance on ETF investing, check out the full guide at this link . What this means for investors While VOO's broad-market focus aims for consistency and stability, QQQ's primary goal is growth. When deciding between the two funds, the best choice for you will depend on your risk tolerance and investing goals. Because VOO tracks the S&P 500, it's much more diversified across sectors. Although it does have a notable tilt toward the technology sector, it's not as strong as QQQ's -- which can help reduce risk during periods of market volatility. The downside to an S&P 500 ETF like VOO, however, is that it can't earn higher-than-average returns. It aims to simply follow the market, so its returns can only be average. QQQ, on the other hand, is designed for above-average returns, focusing heavily on growth-oriented stocks. While that has resulted in higher earnings over the past five years compared to VOO, it's also led to steeper drawdowns and more significant price volatility. More risk-averse investors may prefer VOO's S&P 500 stability, while those seeking higher total returns may opt for a growth fund like...

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