QQQ vs. IWM

Last updated Jun 9, 2026

QQQ (Invesco QQQ ETF) and IWM (iShares Russell 2000 ETF) are both exchange-traded funds - QQQ is a Nasdaq-100 fund tracking the NASDAQ-100 Index, while IWM is a Small Cap Blend Equities fund tracking the Russell 2000 Index. Both are passively managed. Over the past 10 years, QQQ returned 21.59%/yr vs 10.78%/yr for IWM. A 0.77 correlation means they provide meaningful diversification when combined. QQQ charges 0.18%/yr vs 0.19%/yr for IWM.

Performance

QQQ vs. IWM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Invesco QQQ ETF (QQQ) and iShares Russell 2000 ETF (IWM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, QQQ achieves a 16.71% return, which is significantly higher than IWM's 15.62% return. Over the past 10 years, QQQ has outperformed IWM with an annualized return of 21.59%, while IWM has yielded a comparatively lower 10.78% annualized return.

QQQ

• 1D: 1.56%
• 1M: 0.68%
• YTD: 16.71%
• 6M: 15.00%
• 1Y: 35.78%
• 3Y*: 27.15%
• 5Y*: 16.98%
• 10Y*: 21.59%

IWM

• 1D: 0.87%
• 1M: -0.02%
• YTD: 15.62%
• 6M: 13.83%
• 1Y: 35.52%
• 3Y*: 16.64%
• 5Y*: 5.48%
• 10Y*: 10.78%

*Multi-year figures are annualized to reflect compound growth (CAGR)

QQQ vs. IWM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
QQQ Invesco QQQ ETF	16.71%	20.77%	25.58%	54.86%	-32.58%	27.42%	48.62%	38.96%	-0.13%	32.66%
IWM iShares Russell 2000 ETF	15.62%	12.66%	11.38%	16.83%	-20.48%	14.54%	20.03%	25.39%	-11.12%	14.58%

Correlation

The correlation between QQQ and IWM is 0.68, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.68
Correlation (3Y) Calculated over the trailing 3-year period	0.65
Correlation (5Y) Calculated over the trailing 5-year period	0.72
Correlation (10Y) Calculated over the trailing 10-year period	0.69
Correlation (All Time) Calculated using the full available price history since May 30, 2000	0.77

The correlation between QQQ and IWM shifts across timeframes, from 0.65 (3 years) to 0.77 (all time), reflecting how their relationship changes across market environments.

QQQ vs. IWM - Sectors Allocation Comparison

Sectors	QQQ	IWM
Technology	53.8%	19.5%
Communication Services	15.8%	2.1%
Consumer Cyclical	12.3%	7.9%
Consumer Defensive	7.7%	2.1%
Healthcare	4.2%	16.1%
Industrials	2.8%	17.2%
Utilities	1.4%	3.0%
Basic Materials	1.1%	4.5%
Energy	0.6%	5.8%
Financial Services	0.2%	15.6%
Real Estate	0.1%	5.6%

Return for Risk

QQQ vs. IWM — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

QQQ

QQQ Risk / Return Rank: 69
QQQ Sharpe Ratio Rank: 74
QQQ Sortino Ratio Rank: 67
QQQ Omega Ratio Rank: 70
QQQ Calmar Ratio Rank: 66
QQQ Martin Ratio Rank: 68

IWM

IWM Risk / Return Rank: 63
IWM Sharpe Ratio Rank: 61
IWM Sortino Ratio Rank: 60
IWM Omega Ratio Rank: 54
IWM Calmar Ratio Rank: 71
IWM Martin Ratio Rank: 68

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

QQQ vs. IWM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Invesco QQQ ETF (QQQ) and iShares Russell 2000 ETF (IWM). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

	QQQ	IWM	Difference
Sharpe ratio: Return per unit of total volatility	2.15	1.83	+0.32
Sortino ratio: Return per unit of downside risk	2.77	2.54	+0.23
Omega ratio: Gain probability vs. loss probability	1.38	1.30	+0.07
Calmar ratio: Return relative to maximum drawdown	3.00	3.24	-0.23
Martin ratio: Return relative to average drawdown	11.43	11.44	0.00
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

QQQ vs. IWM - Sharpe Ratio Comparison

The current QQQ Sharpe Ratio is 2.15, which is comparable to the IWM Sharpe Ratio of 1.83. The chart below compares the historical Sharpe Ratios of QQQ and IWM, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	QQQ	IWM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.15	1.83	+0.32
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.76	0.24	+0.52
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.97	0.47	+0.50
Sharpe Ratio (All Time) Calculated using the full available price history	0.40	0.36	+0.04

Drawdowns

QQQ vs. IWM - Drawdown Comparison

The maximum QQQ drawdown since its inception was -82.97%, which is greater than IWM's maximum drawdown of -59.05%. Use the drawdown chart below to compare losses from any high point for QQQ and IWM.

Drawdown Indicators

	QQQ	IWM	Difference
Max Drawdown Largest peak-to-trough decline	-82.97%	-59.05%	-23.92%
Max Drawdown (1Y) Largest decline over 1 year	-11.96%	-11.03%	-0.93%
Max Drawdown (3Y) Largest decline over 3 years	-22.77%	-27.50%	+4.73%
Max Drawdown (5Y) Largest decline over 5 years	-35.12%	-31.91%	-3.21%
Max Drawdown (10Y) Largest decline over 10 years	-35.12%	-41.13%	+6.01%
Current Drawdown Current decline from peak	-4.03%	-2.71%	-1.32%
Average Drawdown Average peak-to-trough decline	-32.77%	-10.76%	-22.01%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.14%	3.11%	+0.03%

Volatility

QQQ vs. IWM - Volatility Comparison

Invesco QQQ ETF (QQQ) and iShares Russell 2000 ETF (IWM) have volatilities of 6.84% and 6.52%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	QQQ	IWM	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.84%	6.52%	+0.32%
Volatility (6M) Calculated over the trailing 6-month period	13.20%	14.00%	-0.80%
Volatility (1Y) Calculated over the trailing 1-year period	16.74%	19.53%	-2.79%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.49%	22.58%	-0.09%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.36%	23.07%	-0.71%

QQQ vs. IWM - Expense Ratio Comparison

QQQ has a 0.18% expense ratio, which is lower than IWM's 0.19% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

QQQ vs. IWM - Dividend Comparison

QQQ's dividend yield for the trailing twelve months is around 0.39%, less than IWM's 0.89% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
IWM iShares Russell 2000 ETF	0.89%	1.04%	1.15%	1.35%	1.48%	0.94%	1.04%	1.26%	1.40%	1.26%	1.38%	1.54%
QQQ Invesco QQQ ETF	0.39%	0.45%	0.56%	0.62%	0.80%	0.43%	0.55%	0.74%	0.91%	0.84%	1.06%	0.99%

Frequently Asked Questions

Can I hold both QQQ and IWM in my portfolio?

QQQ and IWM have a correlation of 0.68, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, QQQ or IWM?

QQQ has higher volatility (6.84%) compared to IWM (6.52%). In terms of maximum drawdown, QQQ dropped -82.97% vs IWM's -59.05%.

Which ETF is better, QQQ or IWM?

On 10-year performance, QQQ leads with 21.59% vs 10.78% for IWM. On fees, QQQ is cheaper at 0.18% per year. On volatility, IWM has been the lower-risk option at 6.52%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, QQQ or IWM?

Over the 10-year period, QQQ has performed better with a 21.59% return vs 10.78%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, QQQ or IWM?

QQQ is cheaper with a 0.18% expense ratio, compared with 0.19% for IWM.

Which ETF pays a higher dividend yield, QQQ or IWM?

IWM has the higher dividend yield at 0.89%, compared with 0.39% for QQQ.

What is the main difference between QQQ and IWM?

QQQ is categorized as Nasdaq-100, while IWM is Small Cap Blend Equities. QQQ tracks NASDAQ-100 Index, while IWM tracks Russell 2000 Index. They also come from different issuers: Invesco and iShares. Their fees differ too: 0.18% for QQQ and 0.19% for IWM.

Which has better risk-adjusted returns?

QQQ currently has the higher Sharpe Ratio (2.15 vs 1.83), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.