EMD vs QQQ
EMD vs QQQ
Western Asset Emerging Markets Debt Fund Inc vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. EMD offers more diversification with 136 holdings.
Side-by-Side Comparison
| Metric | EMD | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 1.59% | 0.18% | |
| AUM | $636M | $455.8B | |
| Dividend Yield | 9.68% | 0.41% | |
| Holdings | 278 | 108 | |
| YTD Return | +4.76% | +16.83% | |
| 1Y Return | +15.97% | +26.58% | |
| 3Y Return (annualized) | +17.52% | +24.70% | |
| 5Y Return (annualized) | +4.95% | +14.88% | |
| Volatility (annualized) | 17.2% | 30.6% | |
| Max Drawdown | -64.5% | -83.0% | |
| Fund Family | Franklin Templeton Investments (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Dec 1, 2003 | Mar 10, 1999 |
EMD vs QQQ Performance
Western Asset Emerging Markets Debt Fund Inc (EMD) is a ETF from Franklin Templeton Investments (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year EMD returned +15.97% while QQQ returned +26.58%. Year to date, EMD is up 4.76% versus a gain of 16.83% for QQQ.
Over three years, EMD compounded at +17.52% per year against +24.70% for QQQ; over five years the annualized figures are +4.95% and +14.88% respectively. Across the full 23-year window we track, QQQ has the edge at +13.06% annualized vs -0.32%. 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 17.2% for EMD. 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 -64.5% for EMD 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 0.57. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
EMD charges 1.59% per year while QQQ charges 0.18%. On a $10,000 position that is $159 vs $18 annually, a gap of $141 per year that compounds over a long holding period. On income, EMD currently yields 9.68% against 0.41% for QQQ.
Holdings Overlap
EMD and QQQ share 0 holdings out of 239 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, EMD or QQQ?
EMD has an expense ratio of 1.59% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $141 per year of difference.
Which performed better, EMD or QQQ?
Over the past year EMD returned +15.97% vs +26.58% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (23 years), EMD annualized -0.32% vs +13.06% for QQQ. Past performance does not guarantee future results.
Which is riskier, EMD or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 17.2% for EMD. Worst drawdown: EMD -64.5% vs QQQ -83.0%.
Should I hold both EMD and QQQ?
EMD and QQQ have a monthly-return correlation of 0.57, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between EMD and QQQ?
EMD and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 239 unique securities.
Which pays a higher dividend, EMD or QQQ?
EMD yields 9.68% while QQQ yields 0.41%, so EMD currently pays the higher dividend yield.
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