ETF Spotlight on PowerShares QQQ Trust ETF (NYSEArca: QQQ), part of an ongoing series.

Assets: $32.3 billio.

Objective: The PowerShares QQQ fund is based on the Nasdaq-100 Index, which consists of 100 of the largest domestic and international nonfinancial companies listed on the NASDAQ based on market capitalization.

Holdings: Top holdings include: Apple (NasdaqGS: AAPL) 18.9%, Microsoft (NasdaqGS: MSFT) 8.9%, Google (NasdaqGS: GOOG) 5.2%, Oracle (NasdaqGS: ORCL) 4.8% and Intel (NasdaqGS: INTC) 4.8%.

What You Should Know:

  • PowerShares sponsors the fund.
  • QQQ has an expense ratio of 0.20%.
  • The ETF has 100 holdings and the top ten make up 53.2%.
  • Sector allocations include consumer discretionary 16.3%, consumer staples 2.5%, health care 10.8%, industriasl 1.8%, information technology 67.2%, materials 0.5% telecommunication serivces
  • The fund rebalances and is reconstituted on a quarterly basis.
  • QQQ has a 0.81% dividend yield.
  • The ETF is up 5.6% over the last month, down 4.11% over the past three months and up 15.3% year-to-date.
  • The fund is back up 4.5% over its 200-day exponential moving average.
  • “When considering whether to invest, investors should take note of the fact that stocks in this fund make up almost the entire 20% tech component of the S&P 500,” according to Morningstar analyst Robert Goldsborough. “Despite the relatively low overlap, QQQ has a high correlation in performance with the S&P 500 (92% over the past five years) and an even higher correlation with the large technology ETF Technology Select Sector SDPR XLK (97% in the past 10 years).”
  • “Apple is the largest weight in the index and, as a result, the largest holding in this ETF,” Goldsborough added. “As such, investors interested in this fund should watch Apple’s near- and medium-term prospects very closely.”

The Latest News:

  • According to Zacks research, tech earnings are expected to rise 1.8% in the second quarter, compared to the 13.6% growth in the first quarter.
  • Excluding Apple, tech stocks are estimated to be down 4.2% for the second quarter.
  • Tech revenue is calculated to gain 5.1% in the second quarter, or up 2% when excluding Apple.

PowerShares QQQ Trust ETF

For past stories in this series, visit our ETF Spotlight category.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.