One tech-heavy growth fund dominated flows into ETFs during March, taking in more new assets than any other ETF available to U.S. investors.
The Invesco QQQ Trust (QQQ), closing the month with $197 billion in assets under management, took in $6 billion in March, helping offset previous months’ outflows, bringing year-to-date net outflows to $260 million, according to ETF Database.
QQQ owns the most valuable stocks trading on the Nasdaq and is, by a long shot, the most popular ETF that tracks the NASDAQ-100 Index.
The Invesco NASDAQ 100 ETF (QQQM), which is affectionately dubbed the “Q mini” for offering investors identical exposure as QQQ, according to ETF Database, also had a great month in March. QQQM saw $627 million in March inflows, bringing year-to-date net inflows to $994 million as of the end of the month.
QQQ is used primarily by short-term traders, as evidenced by the significant average daily trading volumes. QQQ has penny-wide spreads and can be a nice tool for those looking to quickly establish a position in U.S. equity markets, according to ETF Database.
On the other hand, QQQM appeals more to buy-and-hold investors. The Q mini has a lower management fee at 15 basis points compared to QQQ’s expense ratio of 20 basis points, according to ETF Database.
While QQQM offers investors the opportunity to achieve the same exposure with a lower cost, the total cost of ownership balances the scale, allowing investors to decide for themselves which is a better fit for their portfolios. QQQ, due to its popularity and hundreds of billions in assets, is more liquid and has lower trading costs.
The Invesco innovation suite also includes the Invesco ESG NASDAQ 100 ETF (QQMG), the Invesco NASDAQ Next Gen 100 ETF (QQQJ), and the Invesco ESG NASDAQ Next Gen 100 ETF (QQJG), in addition to QQQ and QQQM.
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