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VTWO vs. QQQ
Performance
Return for Risk
Drawdowns
Volatility
Dividends

VTWO vs. QQQ

Last updated Jun 14, 2026

VTWO (Vanguard Russell 2000 ETF) and QQQ (Invesco QQQ ETF) are both exchange-traded funds - VTWO is a Small Cap Blend Equities fund tracking the Russell 2000 Index, while QQQ is a Nasdaq-100 fund tracking the NASDAQ-100 Index. Both are passively managed. Over the past 10 years, VTWO returned 11.41%/yr vs 21.79%/yr for QQQ. A 0.73 correlation means they provide meaningful diversification when combined. VTWO charges 0.06%/yr vs 0.18%/yr for QQQ.

Performance

VTWO vs. QQQ - Performance Comparison

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

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Returns By Period

In the year-to-date period, VTWO achieves a 19.26% return, which is significantly higher than QQQ's 17.57% return. Over the past 10 years, VTWO has underperformed QQQ with an annualized return of 11.41%, while QQQ has yielded a comparatively higher 21.79% annualized return.

VTWO

1D
0.86%
1M
5.50%
YTD
19.26%
6M
16.09%
1Y
42.05%
3Y*
17.46%
5Y*
6.23%
10Y*
11.41%

QQQ

1D
0.59%
1M
1.75%
YTD
17.57%
6M
17.85%
1Y
37.55%
3Y*
26.43%
5Y*
16.85%
10Y*
21.79%
*Multi-year figures are annualized to reflect compound growth (CAGR)

VTWO vs. QQQ - Yearly Performance Comparison

2026 (YTD)202520242023202220212020201920182017
VTWO
Vanguard Russell 2000 ETF		19.26%12.90%11.55%17.08%-20.49%14.79%20.22%25.81%-11.15%14.69%
QQQ
Invesco QQQ ETF		17.57%20.77%25.58%54.86%-32.58%27.42%48.62%38.96%-0.13%32.66%

Correlation

The correlation between VTWO and QQQ is 0.69, 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

0.69

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 Sep 22, 2010

0.73

The correlation between VTWO and QQQ has been stable across timeframes, ranging from 0.65 to 0.73 - a consistent structural relationship.

VTWO vs. QQQ - Sectors Allocation Comparison

Sectors
VTWO
QQQ

Industrials

17.7%
2.6%

Technology

17.0%
58.7%

Healthcare

16.5%
3.7%

Financial Services

15.7%
0.2%

Consumer Cyclical

8.4%
11.4%

Real Estate

6.1%
0.1%

Energy

6.1%
0.5%

Basic Materials

4.8%
1.0%

Utilities

2.9%
1.2%

Communication Services

2.4%
14.3%

Consumer Defensive

2.4%
6.4%

Industrials

VTWO
17.7%
QQQ
2.6%

Technology

VTWO
17.0%
QQQ
58.7%

Healthcare

VTWO
16.5%
QQQ
3.7%

Financial Services

VTWO
15.7%
QQQ
0.2%

Consumer Cyclical

VTWO
8.4%
QQQ
11.4%

Real Estate

VTWO
6.1%
QQQ
0.1%

Energy

VTWO
6.1%
QQQ
0.5%

Basic Materials

VTWO
4.8%
QQQ
1.0%

Utilities

VTWO
2.9%
QQQ
1.2%

Communication Services

VTWO
2.4%
QQQ
14.3%

Consumer Defensive

VTWO
2.4%
QQQ
6.4%

Compare stocks, funds, or ETFs

Search for stocks, ETFs, and funds for a quick comparison or use the comparison tool for more options.

Vanguard Russell 2000 ETF

Invesco QQQ ETF

Often compared with VTWO:
VTWO vs. IWMVTWO vs. VBVTWO vs. VOOVTWO vs. VTWVVTWO vs. VTWGVTWO vs. FSSNXVTWO vs. VIOO
Often compared with QQQ:
QQQ vs. SPYQQQ vs. VOOQQQ vs. VGTQQQ vs. TQQQQQQ vs. SMHQQQ vs. QQQMQQQ vs. QQQI

Return for Risk

VTWO vs. QQQ — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.
VTWO
VTWO Risk / Return Rank: 7373
Overall Rank
VTWO Sharpe Ratio Rank: 7272
Sharpe Ratio Rank
VTWO Sortino Ratio Rank: 7171
Sortino Ratio Rank
VTWO Omega Ratio Rank: 6363
Omega Ratio Rank
VTWO Calmar Ratio Rank: 7979
Calmar Ratio Rank
VTWO Martin Ratio Rank: 7777
Martin Ratio Rank
QQQ
QQQ Risk / Return Rank: 7171
Overall Rank
QQQ Sharpe Ratio Rank: 7575
Sharpe Ratio Rank
QQQ Sortino Ratio Rank: 7070
Sortino Ratio Rank
QQQ Omega Ratio Rank: 7373
Omega Ratio Rank
QQQ Calmar Ratio Rank: 6969
Calmar Ratio Rank
QQQ Martin Ratio Rank: 7070
Martin Ratio Rank
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.

VTWO vs. QQQ - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Russell 2000 ETF (VTWO) 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.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

VTWOQQQDifference
Sharpe ratioReturn per unit of total volatility
2.02
2.09

-0.08

Sortino ratioReturn per unit of downside risk
2.77
2.73

+0.04

Omega ratioGain probability vs. loss probability

1.33

1.37

-0.04

Calmar ratioReturn relative to maximum drawdown

3.61

3.01

+0.60

Martin ratioReturn relative to average drawdown

12.79

11.22

+1.56

VTWO vs. QQQ - Sharpe Ratio Comparison

The current VTWO Sharpe Ratio is 2.02, which is comparable to the QQQ Sharpe Ratio of 2.09. The chart below compares the historical Sharpe Ratios of VTWO 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.

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Drawdowns

VTWO vs. QQQ - Drawdown Comparison

The maximum VTWO drawdown since its inception was -41.19%, smaller than the maximum QQQ drawdown of -82.97%. Use the drawdown chart below to compare losses from any high point for VTWO and QQQ.

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Drawdown Indicators

VTWOQQQDifference

Max Drawdown

Largest peak-to-trough decline

-41.19%

-82.97%

+41.78%

Max Drawdown (1Y)

Largest decline over 1 year

-10.99%

-11.96%

+0.97%

Max Drawdown (3Y)

Largest decline over 3 years

-27.57%

-22.77%

-4.80%

Max Drawdown (5Y)

Largest decline over 5 years

-31.88%

-35.12%

+3.24%

Max Drawdown (10Y)

Largest decline over 10 years

-41.19%

-35.12%

-6.07%

Current Drawdown

Current decline from peak

0.00%

-3.33%

+3.33%

Average Drawdown

Average peak-to-trough decline

-8.38%

-32.75%

+24.37%

Ulcer Index

Depth and duration of drawdowns from previous peaks

3.10%

3.20%

-0.10%

Volatility

VTWO vs. QQQ - Volatility Comparison

The current volatility for Vanguard Russell 2000 ETF (VTWO) is 7.15%, while Invesco QQQ ETF (QQQ) has a volatility of 7.56%. This indicates that VTWO experiences smaller price fluctuations and is considered to be less risky than QQQ based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

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Volatility by Period

VTWOQQQDifference

Volatility (1M)

Calculated over the trailing 1-month period

7.15%

7.56%

-0.41%

Volatility (6M)

Calculated over the trailing 6-month period

14.26%

13.81%

+0.45%

Volatility (1Y)

Calculated over the trailing 1-year period

19.66%

17.19%

+2.47%

Volatility (5Y)

Calculated over the trailing 5-year period, annualized

22.57%

22.55%

+0.02%

Volatility (10Y)

Calculated over the trailing 10-year period, annualized

23.13%

22.38%

+0.75%

VTWO vs. QQQ - Expense Ratio Comparison

VTWO has a 0.06% 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

VTWO vs. QQQ - Dividend Comparison

VTWO's dividend yield for the trailing twelve months is around 1.06%, more than QQQ's 0.39% yield.

PositionTTM20252024202320222021202020192018201720162015
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%
VTWO
Vanguard Russell 2000 ETF		1.06%1.25%1.21%1.45%1.48%1.13%0.92%1.36%1.41%1.18%1.27%1.23%

Frequently Asked Questions

VTWO and QQQ have a correlation of 0.69, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

QQQ has higher volatility (7.56%) compared to VTWO (7.15%). In terms of maximum drawdown, VTWO dropped -41.19% vs QQQ's -82.97%.

On 10-year performance, QQQ leads with 21.79% vs 11.41% for VTWO. On fees, VTWO is cheaper at 0.06% per year. On volatility, VTWO has been the lower-risk option at 7.15%. The better choice depends on whether you care most about return, fees, risk, or income.

Over the 10-year period, QQQ has performed better with a 21.79% return vs 11.41%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

VTWO is cheaper with a 0.06% expense ratio, compared with 0.18% for QQQ.

VTWO has the higher dividend yield at 1.06%, compared with 0.39% for QQQ.

VTWO is categorized as Small Cap Blend Equities, while QQQ is Nasdaq-100. VTWO tracks Russell 2000 Index, while QQQ tracks NASDAQ-100 Index. They also come from different issuers: Vanguard and Invesco. Their fees differ too: 0.06% for VTWO and 0.18% for QQQ.

QQQ currently has the higher Sharpe Ratio (2.09 vs 2.02), 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.

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