LMBS vs QQQ
LMBS vs QQQ
First Trust Low Duration Opportunities ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. LMBS offers more diversification with 764 holdings.
Side-by-Side Comparison
| Metric | LMBS | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.65% | 0.18% | |
| AUM | $6.4B | $455.8B | |
| Dividend Yield | 4.10% | 0.41% | |
| Holdings | 1,213 | 108 | |
| YTD Return | +1.77% | +18.20% | |
| 1Y Return | +4.18% | +27.63% | |
| 3Y Return (annualized) | +5.63% | +25.54% | |
| 5Y Return (annualized) | +3.10% | +15.12% | |
| Volatility (annualized) | 2.2% | 30.6% | |
| Max Drawdown | -8.5% | -83.0% | |
| Fund Family | First Trust Portfolios (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Nov 4, 2014 | Mar 10, 1999 |
LMBS vs QQQ Performance
First Trust Low Duration Opportunities ETF (LMBS) is a ETF from First Trust Portfolios (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year LMBS returned +4.18% while QQQ returned +27.63%. Year to date, LMBS is up 1.77% versus a gain of 18.20% for QQQ.
Over three years, LMBS compounded at +5.63% per year against +25.54% for QQQ; over five years the annualized figures are +3.10% and +15.12% respectively. Across the full 12-year window we track, QQQ has the edge at +13.11% annualized vs +1.51%. 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 2.2% for LMBS. 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 -8.5% for LMBS 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 0.35. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
LMBS charges 0.65% per year while QQQ charges 0.18%. On a $10,000 position that is $65 vs $18 annually, a gap of $47 per year that compounds over a long holding period. On income, LMBS currently yields 4.10% against 0.41% for QQQ.
Holdings Overlap
LMBS and QQQ share 0 holdings out of 867 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, LMBS or QQQ?
LMBS has an expense ratio of 0.65% while QQQ charges 0.18%. QQQ is the cheaper option. On a $10,000 investment, that is $47 per year of difference.
Which performed better, LMBS or QQQ?
Over the past year LMBS returned +4.18% vs +27.63% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (12 years), LMBS annualized +1.51% vs +13.11% for QQQ. Past performance does not guarantee future results.
Which is riskier, LMBS or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 2.2% for LMBS. Worst drawdown: LMBS -8.5% vs QQQ -83.0%.
Should I hold both LMBS and QQQ?
LMBS and QQQ have a monthly-return correlation of 0.35, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between LMBS and QQQ?
LMBS and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 867 unique securities.
Which pays a higher dividend, LMBS or QQQ?
LMBS yields 4.10% while QQQ yields 0.41%, so LMBS currently pays the higher dividend yield.
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