Is Direxion NASDAQ-100 Equal Weighted Index ETF (QQQE) a Strong ETF Right Now?

For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.

Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.

If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.

Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.

While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.

Fund Sponsor & Index

The fund is managed by Direxion. QQQE has been able to amass assets over $1.35 billion, making it one of the larger ETFs in the Style Box - Large Cap Growth. This particular fund seeks to match the performance of the NASDAQ-100 Equal Weighted Index before fees and expenses.

The NASDAQ-100 Equal Weighted Index consists of companies in the NASDAQ-100 Index but each of the securities is initially set at a weight of 1.00% of the Index. The NASDAQ-100 Index includes 100 of the largest non-financial securities listed on NASDAQ based on capitalization.

Cost & Other Expenses

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.

Operating expenses on an annual basis are 0.35% for QQQE, making it on par with most peer products in the space.

The fund has a 12-month trailing dividend yield of 0.58%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Information Technology sector - about 46.9% of the portfolio. Industrials and Consumer Discretionary round out the top three.

Looking at individual holdings, Marvell Technology Inc (MRVL) accounts for about 2.78% of total assets, followed by Arm Holdings Plc-adr (ARM) and Advanced Micro Devices (AMD).

QQQE's top 10 holdings account for about 19.81% of its total assets under management.

Performance and Risk

The ETF has added roughly 15% so far this year and is up about 18.09% in the last one year (as of 07/23/2026). In the past 52-week period, it has traded between $96.06 and $122.72

QQQE has a beta of 1.08 and standard deviation of 17.33% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 102 holdings, it effectively diversifies company-specific risk .

Alternatives

Direxion NASDAQ-100 Equal Weighted Index ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.

Vanguard Growth Index Fund ETF Shares (VUG) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ) tracks NASDAQ-100 Index. Vanguard Growth Index Fund ETF Shares has $221.78 billion in assets, Invesco QQQ has $473.29 billion. VUG has an expense ratio of 0.03% and QQQ changes 0.18%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Growth

Bottom Line

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

.

Boost Your Portfolio with Our Top ETF Insights

Zacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.

Don’t miss out on this valuable resource. It’s 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

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research