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

The Direxion NASDAQ-100 Equal Weighted Index Shares (QQQE) was launched on 03/21/2012, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Growth category of the market.What Are Smart Beta ETFs?The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.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.But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of 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 & IndexThe fund is managed by Direxion. QQQE has been able to amass assets over $1.24 billion, making it one of the average sized ETFs in the Style Box - Large Cap Growth. QQQE, before fees and expenses, seeks to match the performance of the NASDAQ-100 Equal Weighted Index.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 ExpensesInvestors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.Annual operating expenses for QQQE are 0.35%, which makes it on par with most peer products in the space.QQQE's 12-month trailing dividend yield is 0.51%.Sector Exposure and Top HoldingsETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.For QQQE, it has heaviest allocation in the Information Technology sector --about 40.3% of the portfolio --while Consumer Discretionary and Healthcare round out the top three.Taking into account individual holdings, Micron Technology Inc (MU) accounts for about 1.53% of the fund's total assets, followed by Warner Bros Discovery Inc (WBD) and Applied Materials Inc (AMAT).The top 10 holdings account for about 13.15% of total assets under management.Performance and RiskSo far this year, QQQE has gained about 2.38%, and is up about 17.54% in the last one year (as of 01/14/2026). During this past 52-week period, the fund has traded between $76.98 and $105.25.The fund has a beta of 1.06 and standard deviation of 17.31% for the trailing three-year period, which makes QQQE a medium risk choice in this particular space. With about 102 holdings, it effectively diversifies company-specific risk .AlternativesDirexion NASDAQ-100 Equal Weighted Index Shares 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 ETF (VUG) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ) tracks NASDAQ-100 Index. Vanguard Growth ETF has $204.36 billion in assets, Invesco QQQ has $411.1 billion. VUG has an expense ratio of 0.04% and QQQ changes 0.20%.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 GrowthBottom LineTo 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.Boost Your Portfolio with Our Top ETF InsightsZacks' 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!Get it now >>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 Direxion NASDAQ-100 Equal Weighted Index Shares (QQQE): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks