Should Invesco NASDAQ Next Gen 100 ETF (QQQJ) Be on Your Investing Radar?

Launched on 10/13/2020, the Invesco NASDAQ Next Gen 100 ETF (QQQJ) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.The fund is sponsored by Invesco. It has amassed assets over $676.63 million, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.Why Large Cap GrowthCompanies that find themselves in the large cap category typically have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Further, growth stocks have a higher level of volatility associated with them. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.CostsCost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.Annual operating expenses for this ETF are 0.15%, making it one of the least expensive products in the space.It has a 12-month trailing dividend yield of 0.74%.Sector Exposure and Top HoldingsEven though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.This ETF has heaviest allocation to the Information Technology sector--about 34% of the portfolio. Healthcare and Consumer Discretionary round out the top three.Looking at individual holdings, United Airlines Holdings Inc (UAL) accounts for about 2.06% of total assets, followed by Ebay Inc (EBAY) and Alnylam Pharmaceuticals Inc (ALNY).The top 10 holdings account for about 16.6% of total assets under management.Performance and RiskQQQJ seeks to match the performance of the NASDAQ NEXT GENERATION 100 INDEX before fees and expenses. The NASDAQ Next Generation 100 Index comprises of securities of the next generation of Nasdaq-listed non-financial companies; that is, the largest 100 Nasdaq-listed companies outside of the NASDAQ-100 Index.The ETF return is roughly 3.98% so far this year and it's up approximately 19.67% in the last one year (as of 01/30/2025). In the past 52-week period, it has traded between $26.46 and $32.64.The ETF has a beta of 1.14 and standard deviation of 22.54% for the trailing three-year period. With about 108 holdings, it effectively diversifies company-specific risk.AlternativesInvesco NASDAQ Next Gen 100 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, QQQJ is a reasonable option for those seeking exposure to the Style Box - Large Cap Growth area of the market. Investors might also want to consider some other ETF options in the space.The Vanguard Growth ETF (VUG) and the Invesco QQQ (QQQ) track a similar index. While Vanguard Growth ETF has $159.38 billion in assets, Invesco QQQ has $326.65 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.Bottom-LineAn increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco NASDAQ Next Gen 100 ETF (QQQJ): ETF Research Reports Alnylam Pharmaceuticals, Inc. (ALNY): Free Stock Analysis Report United Airlines Holdings Inc (UAL): Free Stock Analysis Report eBay Inc. (EBAY): Free Stock Analysis Report Invesco QQQ (QQQ): ETF Research Reports Vanguard Growth ETF (VUG): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks