CGMS vs QQQ
CGMS vs QQQ
Capital Group US Multi Sector Income ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. CGMS offers more diversification with 831 holdings.
Side-by-Side Comparison
| Metric | CGMS | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.39% | 0.18% | |
| AUM | $5.3B | $455.8B | |
| Dividend Yield | 6.12% | 0.41% | |
| Holdings | 1,447 | 108 | |
| YTD Return | +1.74% | +18.34% | |
| 1Y Return | +4.48% | +28.94% | |
| 3Y Return (annualized) | +7.70% | +25.28% | |
| 5Y Return (annualized) | - | +15.22% | |
| Volatility (annualized) | 5.1% | 30.6% | |
| Max Drawdown | -4.1% | -83.0% | |
| Fund Family | Capital Group (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Oct 25, 2022 | Mar 10, 1999 |
CGMS vs QQQ Performance
Capital Group US Multi Sector Income ETF (CGMS) is a ETF from Capital Group (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year CGMS returned +4.48% while QQQ returned +28.94%. Year to date, CGMS is up 1.74% versus a gain of 18.34% for QQQ.
Over three years, CGMS compounded at +7.70% per year against +25.28% for QQQ. Across the full 4-year window we track, QQQ has the edge at +13.12% annualized vs +8.13%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 5.1% for CGMS. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -4.1% for CGMS and -83.0% for QQQ. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.60. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
CGMS charges 0.39% per year while QQQ charges 0.18%. On a $10,000 position that is $39 vs $18 annually, a gap of $21 per year that compounds over a long holding period. On income, CGMS currently yields 6.12% against 0.41% for QQQ.
Holdings Overlap
CGMS and QQQ share 0 holdings out of 934 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, CGMS or QQQ?
CGMS has an expense ratio of 0.39% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $21 per year of difference.
Which performed better, CGMS or QQQ?
Over the past year CGMS returned +4.48% vs +28.94% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (4 years), CGMS annualized +8.13% vs +13.12% for QQQ. Past performance does not guarantee future results.
Which is riskier, CGMS or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 5.1% for CGMS. Worst drawdown: CGMS -4.1% vs QQQ -83.0%.
Should I hold both CGMS and QQQ?
CGMS and QQQ have a monthly-return correlation of 0.60, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between CGMS and QQQ?
CGMS and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 934 unique securities.
Which pays a higher dividend, CGMS or QQQ?
CGMS yields 6.12% while QQQ yields 0.41%, so CGMS currently pays the higher dividend yield.
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