Publicly traded firms with suspect management teams can possibly notch short-term gains. However, over the long term, the odds of investor success at poorly run companies lengthen.
Conversely, companies with strong management don’t see their shares appreciate in straight-line fashion. However, the probabilities of long-term success are on investors’ sides. One point to remember is that no sector has a monopoly on good or bad management. This perhaps makes it difficult to isolate well-run companies via exchange traded funds.
Fortunately, the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM) are prime examples of ETFs full of companies with strong presences in the C-suite, including in the chief executive officer role.
It’s just one list, but the recently revealed 2023 Barron’s Top CEOs features 25 CEOs that have navigated their firms through some trying circumstances over the past several years. The list prominently features both ETFs’ member firms.
QQQ, QQQM Management Strong Across Variety of Sectors
QQQ and QQQM track the Nasdaq-100 Index, and as such, the ETFs are viewed as tech proxies. That’s an accurate assessment, as the funds devote nearly 51% of their weights to that sector. Good news: The Barron’s list holds many tech CEOs.
That group includes Apple’s (NASDAQ: AAPL) Tim Cook and Microsoft’s (NASDAQ: MSFT) Satya Nadella. Those stocks are the top two holdings in the Invesco ETFs, combining for over a quarter of the fund’s roster. However, the strong management theme in QQQ and QQQM isn’t limited to Apple and Microsoft.
Other tech companies whose CEOs appear on the Barron’s list include NVIDIA (NASDAQ: NVDA) and Adobe (NASDAQ: ADBE), which combine for 8.60% of QQQ and QQQM. Sundar Pichai, CEO of Google parent Alphabet (NASDAQ: GOOG) — a communications services firm and QQQ/QQQM holding — is also on the list.
Owing to the growth leanings of QQQ and QQQM, some investors forget that the ETFs feature smaller allocations to slower growth sectors, including consumer staples. The positive news is that two of the most well-run consumer staples are among the eight stocks from that sector found in the two Invesco ETFs.
Ramon Laguarta at PepsiCo (NASDAQ: PEP) and Craig Jelinek of Costco Wholesale (NASDAQ: COST) appear on the Barron’s list. Those are the two largest consumer staples holdings in QQQ and QQQM, combining for over 3% of the ETFs’ rosters.
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