Morningstar Rating

ETF Research and Analysis

by Robert Goldsborough
Suitability
PowerShares QQQ ETF QQQ, the 11th most actively traded and sixth-largest U.S. exchange-traded fund offers a large helping of large-cap growth stocks with a strong tilt toward the technology sector. QQQ, which tracks the   Read more 

Bull Case

This fund has a very high-quality portfolio. About 91% of its investments are in companies that have Morningstar Economic Moat Ratings of wide or narrow: firms that Morningstar equity analysts believe have durable competitive advantages. That's above competing large-cap growth ETFs IWF and VUG, whose moat percentages are in the 85% range.
This ETF is one of the most actively traded securities on the market, and its holdings are also very liquid. Thus, bid-ask spreads should remain tight and tracking error should remain negligible. Read more 

Bear Case

This fund's top-heavy construction has contributed to above-average volatility over time.
Investors who use ETFs as long-term portfolio building blocks may find this fund difficult to use because of its unusual sector weightings. Read more 

Low-Cost Exposure to High-Quality Companies 
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