QQQQ

What Is QQQQ?

The QQQQ is the original ticker symbol for the Nasdaq 100 Trust, an ETF that trades on the Nasdaq exchange. This security offers broad exposure to the tech sector by tracking the Nasdaq 100 Index, which consists of the 100 largest and most actively traded non-financial stocks on the Nasdaq. Also known as "cubes" or the "quadruple-Qs," it is now listed under the Invesco QQQ Trust or its current ticker symbol: QQQ.

Key Takeaways

  • The QQQQ is the original ticker symbol for the Nasdaq 100 Trust, an ETF that trades on the Nasdaq exchange. 
  • This ETF offers broad exposure to the tech sector by tracking the Nasdaq 100 Index, which tracks the 100 largest and most actively traded non-financial stocks on the Nasdaq. 
  • This ETF excludes financial services names.
  • The ETF, whose current ticker symbol is QQQ, is also known as "cubes" or the "quadruple-Qs."

Understanding the QQQQ

Although the QQQQ is now officially the Invesco QQQ Trust, it still tracks the Nasdaq 100, a stock index listing the 100 largest Nasdaq companies by market cap. The Nasdaq 100 index comprises companies from all sectors, with the exception of financial services. These industries include retail, biotechnology, industrial, technology, health care, and many others. This fund provides an especially viable investment choice for investors seeking exposure to the tech sector, because many of the largest companies listed on the Nasdaq are blue-chip tech behemoths such as Google (GOOGL), Microsoft (MSFT), and Qualcomm (QCOM).

All companies in the Invesco QQQ Trust must be listed on the Nasdaq 100 exchange for at least two years. But there are certain exceptions to this rule. Namely, certain companies that have been listed for only one year but have extraordinarily high market capitalizations may make the cut. All stocks need to have an average daily trading volume of 200,000 shares, and they are likewise required to report earnings on both quarterly and annual bases. Companies with bankruptcy issues are omitted from the Invesco QQQ Trust.

The Nasdaq 100 Trust began in 1999 as a side project created by a few Nasdaq exchange employees who sought to help mom-and-pop investors participate in the dotcom boom.

Composition of the Invesco QQQ Trust

The Invesco QQQ Trust is extremely tech-forward, with 50.36% of its assets allocated to the technology sector. Consumer cyclicals are the next highest weighted sector, with a 17.99% allocation. Meanwhile, the communication services sector rounds out the top three silos, with a 17.79% allocation. All other sectors have less than a 10% allocation within the ETF, with health care, industrials, and utilities rounding out the top six sectors represented.

It's no surprise then that eight of the Invesco QQQ Trust's top 10 company holdings are notable tech stalwarts such as Apple, Microsoft, Amazon, Google, and Meta (formerly Facebook).

It's worth noting the Invesco QQQ Trust tracks a limited number of stocks compared to other Nasdaq ETFs. Case in point: the popular Nasdaq Composite Index tracks every stock listed on the Nasdaq, including financial services names, which amounts to more than 3,000 public companies.

Article Sources

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  1. Invesco. "Invesco QQQ." Accessed Nov. 25, 2021.

  2. Invesco. "QQQ, Invesco QQQ." Accessed Nov. 25, 2021.

  3. Invesco. "QQQ: Portfolio." Accessed Nov. 25, 2021.

  4. Nasdaq. "NASDAQ-100 Index® NDX," Page 2. Accessed Nov. 25, 2021.

  5. Nasdaq. "Nasdaq Composite Index." Accessed Nov. 25, 2021.

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