VFMO vs. QQQ

Last updated Jun 3, 2026

VFMO (Vanguard U.S. Momentum Factor ETF) and QQQ (Invesco QQQ ETF) are both exchange-traded funds - VFMO is a Momentum fund actively managed by Vanguard, while QQQ is a Nasdaq-100 fund tracking the NASDAQ-100 Index. VFMO is actively managed, while QQQ is passively managed. Over the past 5 years, VFMO returned 13.98%/yr vs 18.43%/yr for QQQ. A 0.78 correlation means they provide meaningful diversification when combined. VFMO charges 0.13%/yr vs 0.18%/yr for QQQ.

Performance

VFMO vs. QQQ - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard U.S. Momentum Factor ETF (VFMO) and Invesco QQQ ETF (QQQ). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VFMO achieves a 23.55% return, which is significantly higher than QQQ's 21.62% return.

VFMO

• 1D: 1.51%
• 1M: 5.48%
• YTD: 23.55%
• 6M: 24.95%
• 1Y: 44.08%
• 3Y*: 27.89%
• 5Y*: 13.98%
• 10Y*: —

QQQ

• 1D: 0.46%
• 1M: 10.68%
• YTD: 21.62%
• 6M: 20.27%
• 1Y: 43.30%
• 3Y*: 28.89%
• 5Y*: 18.43%
• 10Y*: 21.97%

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

VFMO vs. QQQ - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018
VFMO Vanguard U.S. Momentum Factor ETF	23.55%	17.39%	26.14%	16.25%	-12.84%	19.16%	31.36%	28.22%	-11.41%
QQQ Invesco QQQ ETF	21.62%	20.77%	25.58%	54.86%	-32.58%	27.42%	48.62%	38.96%	-6.12%

Correlation

The correlation between VFMO and QQQ is 0.76, 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	0.76
Correlation (3Y) Calculated over the trailing 3-year period	0.78
Correlation (5Y) Calculated over the trailing 5-year period	0.76
Correlation (All Time) Calculated using the full available price history since Feb 16, 2018	0.78

The correlation between VFMO and QQQ has been stable across timeframes, ranging from 0.76 to 0.78 - a consistent structural relationship.

VFMO vs. QQQ - Sectors Allocation Comparison

Sectors	VFMO	QQQ
Industrials	24.7%	2.8%
Healthcare	22.9%	4.2%
Technology	17.5%	53.8%
Consumer Cyclical	8.7%	12.3%
Energy	7.3%	0.6%
Financial Services	6.5%	0.2%
Basic Materials	6.4%	1.1%
Communication Services	3.4%	15.8%
Consumer Defensive	2.5%	7.7%
Utilities	0.2%	1.4%
Real Estate	0.1%	0.1%

Return for Risk

VFMO vs. QQQ — Risk / Return Rank

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

VFMO

VFMO Risk / Return Rank: 67
VFMO Sharpe Ratio Rank: 62
VFMO Sortino Ratio Rank: 57
VFMO Omega Ratio Rank: 58
VFMO Calmar Ratio Rank: 78
VFMO Martin Ratio Rank: 78

QQQ

QQQ Risk / Return Rank: 77
QQQ Sharpe Ratio Rank: 83
QQQ Sortino Ratio Rank: 78
QQQ Omega Ratio Rank: 77
QQQ Calmar Ratio Rank: 73
QQQ Martin Ratio Rank: 74

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.

VFMO vs. QQQ - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard U.S. Momentum Factor ETF (VFMO) and Invesco QQQ ETF (QQQ). 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.

	VFMO	QQQ	Difference
Sharpe ratio Return per unit of total volatility	2.09	2.73	-0.64
Sortino ratio Return per unit of downside risk	2.74	3.55	-0.81
Omega ratio Gain probability vs. loss probability	1.36	1.47	-0.11
Calmar ratio Return relative to maximum drawdown	4.07	3.71	+0.36
Martin ratio Return relative to average drawdown	15.40	14.30	+1.10
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VFMO vs. QQQ - Sharpe Ratio Comparison

The current VFMO Sharpe Ratio is 2.09, which is comparable to the QQQ Sharpe Ratio of 2.73. The chart below compares the historical Sharpe Ratios of VFMO and QQQ, 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

	VFMO	QQQ	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.09	2.73	-0.64
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.65	0.83	-0.18
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	—	0.99	—
Sharpe Ratio (All Time) Calculated using the full available price history	0.66	0.41	+0.25

Drawdowns

VFMO vs. QQQ - Drawdown Comparison

The maximum VFMO drawdown since its inception was -36.77%, smaller than the maximum QQQ drawdown of -82.97%. Use the drawdown chart below to compare losses from any high point for VFMO and QQQ.

Drawdown Indicators

	VFMO	QQQ	Difference
Max Drawdown Largest peak-to-trough decline	-36.77%	-82.97%	+46.20%
Max Drawdown (1Y) Largest decline over 1 year	-10.98%	-11.96%	+0.98%
Max Drawdown (3Y) Largest decline over 3 years	-24.40%	-22.77%	-1.63%
Max Drawdown (5Y) Largest decline over 5 years	-25.80%	-35.12%	+9.32%
Max Drawdown (10Y) Largest decline over 10 years	—	-35.12%	—
Current Drawdown Current decline from peak	0.00%	0.00%	0.00%
Average Drawdown Average peak-to-trough decline	-7.77%	-32.79%	+25.02%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.90%	3.11%	-0.21%

Volatility

VFMO vs. QQQ - Volatility Comparison

Vanguard U.S. Momentum Factor ETF (VFMO) has a higher volatility of 6.20% compared to Invesco QQQ ETF (QQQ) at 4.48%. This indicates that VFMO's price experiences larger fluctuations and is considered to be riskier than QQQ based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VFMO	QQQ	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.20%	4.48%	+1.72%
Volatility (6M) Calculated over the trailing 6-month period	16.48%	12.11%	+4.37%
Volatility (1Y) Calculated over the trailing 1-year period	21.20%	15.95%	+5.25%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	21.70%	22.39%	-0.69%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	23.57%	22.30%	+1.27%

VFMO vs. QQQ - Expense Ratio Comparison

VFMO has a 0.13% expense ratio, which is lower than QQQ's 0.18% 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

VFMO vs. QQQ - Dividend Comparison

VFMO's dividend yield for the trailing twelve months is around 0.63%, more than QQQ's 0.38% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
QQQ Invesco QQQ ETF	0.38%	0.45%	0.56%	0.62%	0.80%	0.43%	0.55%	0.74%	0.91%	0.84%	1.06%	0.99%
VFMO Vanguard U.S. Momentum Factor ETF	0.63%	0.82%	0.72%	0.89%	1.72%	0.81%	0.45%	1.22%	0.70%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both VFMO and QQQ in my portfolio?

VFMO and QQQ have a correlation of 0.76, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VFMO or QQQ?

VFMO has higher volatility (6.20%) compared to QQQ (4.48%). In terms of maximum drawdown, VFMO dropped -36.77% vs QQQ's -82.97%.

Which ETF is better, VFMO or QQQ?

On 5-year performance, QQQ leads with 18.43% vs 13.98% for VFMO. On fees, VFMO is cheaper at 0.13% per year. On volatility, QQQ has been the lower-risk option at 4.48%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VFMO or QQQ?

Over the 5-year period, QQQ has performed better with a 18.43% return vs 13.98%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VFMO or QQQ?

VFMO is cheaper with a 0.13% expense ratio, compared with 0.18% for QQQ.

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

VFMO has the higher dividend yield at 0.63%, compared with 0.38% for QQQ.

What is the main difference between VFMO and QQQ?

VFMO is categorized as Momentum, while QQQ is Nasdaq-100. They also come from different issuers: Vanguard and Invesco. Their fees differ too: 0.13% for VFMO and 0.18% for QQQ.

Which has better risk-adjusted returns?

QQQ currently has the higher Sharpe Ratio (2.73 vs 2.09), 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.