QQQ vs WDI
QQQ vs WDI
Invesco QQQ Trust, Series 1 vs Western Asset Diversified Income Fund
Quick Verdict
QQQ has a lower expense ratio. QQQ delivered stronger 1-year returns. WDI offers more diversification with 192 holdings.
Side-by-Side Comparison
| Metric | QQQ | WDI | Winner |
|---|---|---|---|
| Expense Ratio | 0.18% | 1.82% | |
| AUM | $455.8B | $723M | |
| Dividend Yield | 0.41% | 12.55% | |
| Holdings | 108 | 410 | |
| YTD Return | +14.45% | +1.66% | |
| 1Y Return | +24.70% | -1.21% | |
| 3Y Return (annualized) | +24.19% | +10.93% | |
| 5Y Return (annualized) | +14.49% | +2.64% | |
| Volatility (annualized) | 30.6% | 13.9% | |
| Max Drawdown | -83.0% | -32.5% | |
| Fund Family | Invesco (US) | Franklin Templeton Investments (US) | |
| Category | Equity | Fixed Income | |
| Inception | Mar 10, 1999 | Jun 24, 2021 |
QQQ vs WDI Performance
Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US) and Western Asset Diversified Income Fund (WDI) is a ETF from Franklin Templeton Investments (US). Over the past year QQQ returned +24.70% while WDI returned -1.21%. Year to date, QQQ is up 14.45% versus a gain of 1.66% for WDI.
Over three years, QQQ compounded at +24.19% per year against +10.93% for WDI; over five years the annualized figures are +14.49% and +2.64% respectively. Across the full 5-year window we track, QQQ has the edge at +12.98% annualized vs +2.78%. 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 13.9% for WDI. 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 -83.0% for QQQ and -32.5% for WDI. 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 0.62. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
QQQ charges 0.18% per year while WDI charges 1.82%. On a $10,000 position that is $18 vs $182 annually, a gap of $164 per year that compounds over a long holding period. On income, QQQ currently yields 0.41% against 12.55% for WDI.
Holdings Overlap
QQQ and WDI share 0 holdings out of 295 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, QQQ or WDI?
QQQ has an expense ratio of 0.18% while WDI charges 1.82%. QQQ is the cheaper option. On a $10,000 investment, that is $164 per year of difference.
Which performed better, QQQ or WDI?
Over the past year QQQ returned +24.70% vs -1.21% for WDI, so QQQ leads on 1-year performance. Over the longest common window we track (5 years), QQQ annualized +12.98% vs +2.78% for WDI. Past performance does not guarantee future results.
Which is riskier, QQQ or WDI?
QQQ has been the more volatile fund at 30.6% annualized versus 13.9% for WDI. Worst drawdown: QQQ -83.0% vs WDI -32.5%.
Should I hold both QQQ and WDI?
QQQ and WDI have a monthly-return correlation of 0.62, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between QQQ and WDI?
QQQ and WDI share 0 common holdings with a 0.0% weight overlap. Combined, they hold 295 unique securities.
Which pays a higher dividend, QQQ or WDI?
QQQ yields 0.41% while WDI yields 12.55%, so WDI currently pays the higher dividend yield.
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