S&P 500 vs Nasdaq 100
SPY tracks the 500 companies of the S&P 500; QQQ tracks the 100 largest non-financials on the Nasdaq exchange. The overlap is significant but the concentration is very different: SPY is roughly 34% technology, QQQ is over 50%.
Also known as: S&P 500 ETF (SPY) (ETF_SPY, S&P 500, SPX, SP500) · Nasdaq 100 ETF (QQQ) (ETF_QQQ, Nasdaq, NDX)
Why This Comparison Matters
SPY tracks the 500 companies of the S&P 500; QQQ tracks the 100 largest non-financials on the Nasdaq exchange. The overlap is significant but the concentration is very different: SPY is roughly 34% technology, QQQ is over 50%. As of April 24, 2026, SPY trades near $708 and QQQ near $656, with QQQ up 42% over the past year versus SPY up 31% on the back of the 2023-2024-2025 AI rally. Over 10 years, QQQ annualized 20.5% versus SPY 14.9%, but with maximum drawdowns of 83% (dot-com) versus 55% (2008) respectively.
What SPY and QQQ Actually Hold
SPY is the SPDR S&P 500 ETF Trust, the oldest US-listed ETF (launched 1993), tracking the S&P 500 Index of 500 large-cap US companies selected by a committee based on size, liquidity, and earnings. QQQ is the Invesco QQQ Trust, launched 1999, tracking the Nasdaq-100 Index of the 100 largest non-financial companies listed on the Nasdaq exchange.
Both are market-capitalization weighted. The critical difference in selection: the S&P 500 can include companies listed on any US exchange and has a financial-services sector. The Nasdaq-100 is restricted to Nasdaq-listed stocks and excludes financials entirely, which mechanically tilts it toward technology, consumer discretionary, and communication services. The overlap between the two indices is substantial at the top end. Most of the Magnificent Seven (Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta, Tesla) are in both, but they carry meaningfully higher weights in QQQ.
The Sector Composition Gap
SPY sector weights as of early 2026: technology 34.2%, financials 12.7%, healthcare 9.7%, consumer discretionary 10%, industrials 8%, communication services 8.8%, the rest spread across consumer staples, energy, utilities, real estate, and materials. QQQ sector weights: technology 51-58%, communication services 16.2%, consumer discretionary 13.1%, with healthcare, industrials, and utilities making up the remainder.
The practical meaning of those weights is that QQQ is a concentrated bet on the "digital economy" plus adjacent consumer names, while SPY is a broader claim on the US large-cap economy. When technology leads the market, QQQ outperforms by definition. When financials, healthcare, industrials, or energy lead, SPY outperforms. This relationship is mechanical and predictable at the sector level; the interesting questions are about timing and the drivers of sector leadership.
Top Holdings and Concentration Risk
QQQ is substantially more concentrated than SPY at the top. As of early 2026, QQQ's top 5 holdings (Nvidia ~9%, Apple ~7.6%, Microsoft ~5.7%, Amazon ~5.5%, Broadcom ~4.5%) total approximately 33% of the fund. Adding Alphabet ~6.7%, Meta ~3.7%, and Tesla ~3.5% pushes the top-8 concentration above 47%. SPY has the same companies near the top but at lower individual weights, typically capped more tightly by the S&P 500 methodology, giving the top-10 roughly 30-35% of the fund.
Conditional Forward Response (Tail Events)
How Nasdaq 100 ETF (QQQ) has historically behaved in the 5 sessions following a top-decile or bottom-decile daily move in S&P 500 ETF (SPY). Computed from 1,281 aligned daily observations ending .
Following these triggers, Nasdaq 100 ETF (QQQ) falls 0.05% on average over the next 5 sessions, versus an unconditional baseline of +0.29%. 129 qualifying events; Nasdaq 100 ETF (QQQ) closed positive in 56% of them.
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Frequently Asked Questions
Is QQQ better than SPY for long-term investing?+
Over 10-year windows since QQQ's 1999 inception, QQQ has returned about 20.5% annualized versus SPY's 14.9%. But that advantage is recency-biased: an investor who bought QQQ at the March 2000 peak waited until August 2016 (16 years) to break even nominally, while the SPY investor was whole by 2007. QQQ has the higher expected return but comes with materially larger drawdowns (83% maximum versus 55% for SPY). Whether it is "better" depends on the investor's horizon, risk tolerance, and tolerance for decade-long underwater periods.
How much of QQQ is Magnificent Seven stocks?+
As of early 2026, the Magnificent Seven (Apple 7.6%, Microsoft 5.7%, Nvidia 9%, Amazon 5.5%, Alphabet 6.7% combined, Meta 3.7%, Tesla 3.5%) total approximately 41-42% of QQQ. Add Broadcom at roughly 4.5% and the top-8 concentration is near 46%. In SPY, the same eight stocks total closer to 28-30%, reflecting SPY's broader denominator of 500 companies with a committee-managed weighting methodology.
What's the difference between SPY and QQQ in a recession?+
QQQ historically has deeper recession drawdowns than SPY, though the pattern depends on whether the recession is accompanied by rising or falling real yields. In 2001-2002 (real yields flat, tech-specific collapse), QQQ fell 83% versus SPY's 48%. In 2008 (real yields fell sharply, financial crisis), QQQ fell about 54% versus SPY's 55%, nearly identical. In 2020 (rapid recovery on fiscal-monetary response), both recovered fast but QQQ outperformed on the recovery. A recession driven by rising real rates (like the mild 2022 slowdown) hurts QQQ more than SPY.
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Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.