EDD vs QQQ
EDD vs QQQ
Morgan Stanley Emerging Markets Domestic Debt Fund Inc. vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. EDD delivered stronger 1-year returns. QQQ offers more diversification with 103 holdings.
Side-by-Side Comparison
| Metric | EDD | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 1.90% | 0.18% | |
| AUM | - | $455.8B | |
| Dividend Yield | 10.70% | 0.41% | |
| Holdings | 684 | 108 | |
| YTD Return | +16.01% | +16.83% | |
| 1Y Return | +29.33% | +26.58% | |
| 3Y Return (annualized) | +20.20% | +24.70% | |
| 5Y Return (annualized) | +8.70% | +14.88% | |
| Volatility (annualized) | 21.0% | 30.6% | |
| Max Drawdown | -81.5% | -83.0% | |
| Fund Family | Morgan Stanley Investment Management | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Apr 24, 2007 | Mar 10, 1999 |
EDD vs QQQ Performance
Morgan Stanley Emerging Markets Domestic Debt Fund Inc. (EDD) is a ETF from Morgan Stanley Investment Management and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year EDD returned +29.33% while QQQ returned +26.58%. Year to date, EDD is up 16.01% versus a gain of 16.83% for QQQ.
Over three years, EDD compounded at +20.20% per year against +24.70% for QQQ; over five years the annualized figures are +8.70% and +14.88% respectively. Across the full 19-year window we track, QQQ has the edge at +13.06% annualized vs -3.67%. 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 21.0% for EDD. 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 -81.5% for EDD 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 0.54. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
EDD charges 1.90% per year while QQQ charges 0.18%. On a $10,000 position that is $190 vs $18 annually, a gap of $172 per year that compounds over a long holding period. On income, EDD currently yields 10.70% against 0.41% for QQQ.
Holdings Overlap
EDD and QQQ share 0 holdings out of 112 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, EDD or QQQ?
EDD has an expense ratio of 1.90% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $172 per year of difference.
Which performed better, EDD or QQQ?
Over the past year EDD returned +29.33% vs +26.58% for QQQ, so EDD leads on 1-year performance. Over the longest common window we track (19 years), EDD annualized -3.67% vs +13.06% for QQQ. Past performance does not guarantee future results.
Which is riskier, EDD or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 21.0% for EDD. Worst drawdown: EDD -81.5% vs QQQ -83.0%.
Should I hold both EDD and QQQ?
EDD and QQQ have a monthly-return correlation of 0.54, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between EDD and QQQ?
EDD and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 112 unique securities.
Which pays a higher dividend, EDD or QQQ?
EDD yields 10.70% while QQQ yields 0.41%, so EDD currently pays the higher dividend yield.
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