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IWM vs. QQQ

iShares Russell 2000 ETF

IWM
$--
vs

Invesco QQQ Trust, Series 1

QQQ
$--

Correlation

0.77
IWMiShares Russell 2000 ETF
QQQInvesco QQQ Trust, Series 1

What is IWM?

The iShares Russell 2000 Index Fund seeks investment results that correspond generally to the price and yield performance before fees and expenses of the small capitalization sector of the U.S. equity market as represented by the Russell 2000 Index. The index represents the approximately 2000 smallest companies in the Russell 3000 Index.

Snapshot
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IWM iShares Russell 2000 ETF
QQQ Invesco QQQ Trust, Series 1
Inception date
May 22 2000
Mar 10 1999
Expense ratio
0.19%
0.20%
IWM has a lower expense ratio than QQQ by 0.01%. This can indicate that it’s cheaper to invest in IWM than QQQ.
Type
US Equities
US Equities
IWM targets investing in US Equities, while QQQ targets investing in US Equities.
Fund owner
Blackrock (iShares)
Invesco
IWM is managed by Blackrock (iShares), while QQQ is managed by Invesco.
Volume (1m avg. daily)
$4,463,198,665
$17,559,045,883
Both IWM and QQQ are considered high-volume assets. They’re less likely to be affected by issues like slippage and failed orders on Composer than low-volume assets.
AUM
$50,549,436,527
$197,956,569,440
IWM has more assets under management than QQQ by $147,407,132,913. Higher AUM can be associated with better liquidity and lower slippage in trading.
Associated index
Russell 2000 Index
Nasdaq 100 Index
IWM is based off of the Russell 2000 Index, while QQQ is based off of the Nasdaq 100 Index
Inverse/Leveraged
No
No
IWM and QQQ use the same leverage ratio. Inverse and leveraged ETFs can be used to either take an opposite position or amplify returns of a given index.
Passive/Active
Passive
Passive
IWM and QQQ both use a Passive investing strategy. In an actively managed fund, the fund manager makes decisions about how funds are invested. A passively managed fund typically tries to track or follow a market index.
Dividend
No
No
IWM and QQQ may offer dividends. The frequency and yield of the dividend may not be the same.
Prospectus
QQQ may issue a K1, while IWM does not. You can find non-K1 alternatives for QQQ in its “Related ETFs” section.
IWM and QQQ’s Correlation
When ETFs are correlated, there are 3 main topics to analyze that will help you build your automated trading strategy: liquidity, expense, and risk.
  • Liquidity: In an active trading strategy (trading multiple time per week), it’s important to consider the liquidity of the ETF you’re using. Lower liquidity can mean more money lost in slippage. AUM and average daily volume are both indicators of liquidity.
  • Expense: Some ETFs are more expensive to use than others. For strategies that are focused on longer holding periods, it’s important to factor in how expensive it is to hold this ETF. Expense ratio is the main indicator of how expensive an ETF is.
  • Risk: Some ETFs will be highly correlated, but have varying degrees of returns, due to leverage. It’s important to consider if an ETF is using leverage or not. The main indicators of a riskier ETF will be the use of leverage and higher standard deviation or max drawdown in a backtest.

Automated Strategies
Related toIWM

#BTD

Buy the Dips: Nasdaq 100

Category

Featured, Technology Focus

Risk Rating

Aggressive

Automated Strategies
Related toQQQ

#BTD

Buy the Dips: Nasdaq 100

Category

Featured, Technology Focus

Risk Rating

Aggressive

Create your own algorithmic
trading strategy

Disclaimers

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We show information directly obtained from our data provider, Xignite. Data shown here is provided by Xignite, an unaffiliated third party. Composer believes the information shown here is reliable, but has not been verified and there is no guarantee that the information is accurate.

**

We show information based on calculations performed by Composer using data from our provider. Information provided here is based on calculations performed by Composer using data sourced from Xignite, an unaffiliated third party. Composer believes this information is reliable, but has not verified the data and there is no guarantee that the calculations are accurate.