DFAW vs QQQ
DFAW vs QQQ
Dimensional World Equity ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. QQQ offers more diversification with 103 holdings.
Side-by-Side Comparison
| Metric | DFAW | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.24% | 0.18% | |
| AUM | $1.6B | $455.8B | |
| Dividend Yield | 1.23% | 0.41% | |
| Holdings | 6 | 108 | |
| YTD Return | +15.60% | +18.20% | |
| 1Y Return | +26.85% | +27.63% | |
| 3Y Return (annualized) | - | +25.54% | |
| 5Y Return (annualized) | - | +15.12% | |
| Volatility (annualized) | 12.1% | 30.6% | |
| Max Drawdown | -16.9% | -83.0% | |
| Fund Family | Dimensional | Invesco (US) | |
| Category | Equity | Equity | |
| Inception | Sep 26, 2023 | Mar 10, 1999 |
DFAW vs QQQ Performance
Dimensional World Equity ETF (DFAW) is a ETF from Dimensional and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year DFAW returned +26.85% while QQQ returned +27.63%. Year to date, DFAW is up 15.60% versus a gain of 18.20% for QQQ.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 12.1% for DFAW. 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 -16.9% for DFAW 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 0.78. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
DFAW charges 0.24% per year while QQQ charges 0.18%. On a $10,000 position that is $24 vs $18 annually, a gap of $6 per year that compounds over a long holding period. On income, DFAW currently yields 1.23% against 0.41% for QQQ.
Holdings Overlap
DFAW and QQQ share 0 holdings out of 108 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, DFAW or QQQ?
DFAW has an expense ratio of 0.24% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $6 per year of difference.
Which performed better, DFAW or QQQ?
Over the past year DFAW returned +26.85% vs +27.63% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (3 years), DFAW annualized +22.91% vs +13.11% for QQQ. Past performance does not guarantee future results.
Which is riskier, DFAW or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 12.1% for DFAW. Worst drawdown: DFAW -16.9% vs QQQ -83.0%.
Should I hold both DFAW and QQQ?
DFAW and QQQ have a monthly-return correlation of 0.78, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between DFAW and QQQ?
DFAW and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 108 unique securities.
Which pays a higher dividend, DFAW or QQQ?
DFAW yields 1.23% while QQQ yields 0.41%, so DFAW currently pays the higher dividend yield.
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