QQQ and QQQM now control over a quarter of the sector’s total assets, driven by 401(k) inflows and outsized returns since 2020.
Invesco’s QQQ and QQQM ETFs now account for 27% of all US large-cap growth ETF assets, a concentration fueled by automatic 401(k) contributions and strong performance. The Nasdaq 100-tracking funds hold $96.8 billion in assets, with QQQM alone representing the smaller of the two.
Since March 2020, QQQ has delivered a 324% return, nearly doubling the S&P 500’s 143% gain. The Nasdaq 100’s outperformance stems from non-tech sectors like consumer and healthcare, despite lower tech exposure than pure tech indices.
The dominance of a single index raises concerns about price discovery, as inflows into QQQ force proportional purchases of its top holdings, already among the world’s largest companies.