The NASDAQ-100’s “larger and more mature companies often have less need for using cash to fuel growth, and many have instead elected to give back to their shareholders by means of paying dividends. This has altered the Index’s dividend profile dramatically,” according to NASDAQ OMX Indexes.
The NASDAQ-100 offers an oft-overlooked advantage compared to other large-cap U.S. benchmarks: It does not exclude foreign companies. For example Chinese Internet giant Baidu (NasdaqGS: BIDU) and U.K. telecom behemoth Vodafone (NasdaqGS: VOD) reside in QQQ.
Additionally, the NASDAQ Q-50 Index, which tracks the 50 companies that are most likely to make the jump to the NASDAQ-100, is home to foreign companies such as Ctrip.com (NasdaqGS: CTRP) and Yandex (NasdaqGS: YNDX), according to Nasdaq data.
Indeed, QQQ and the NASDAQ-100 have come a long way. Fifteen years ago, the ETF’s top-five holdings were Microsoft (NasdaqGS: MSFT), Intel (NasdaqGS: INTC), Cisco (NasdaqGS: CSCO), MCI and Dell. Today, only Microsoft remains in the top-five.
NASDAQ-100 Dividend History
Chart Courtesy: NASDAQ OMX Indexes
Tom Lydon’s clients own shares of Apple, Microsoft, Intel and QQQ.