Animal Spirits Podcast
Talk Your Book: The Mount Rushmore of ETFs
Mar 18, 2024
Explore the journey of the QQQQ ETF, rise of Nvidia and NASDAQ 100, rules and construction of NASDAQ 100, evolution and impact of ETFs, exceptional growth and challenges in the market, and innovation trends in the NASDAQ 100.
35:42
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Quick takeaways
- The QQQ ETF has shown slow growth initially but has experienced a sharp uptick since 2011, aligning with the tech sector's surge.
- The NASDAQ 100 ETF has evolved significantly, with top 10 holdings representing 50% and top 25 holdings around 70% due to the tech sector's dominance.
Deep dives
The NASDAQ 100's Historical Performance and Growth Journey
The NASDAQ 100 ETF, known as the QQQQ, has had a varied history of performance and growth. Initially launched in early 1999, it faced an 80% drawdown soon after. From 1999 to 2011, the total return was at a mere 1% annually, showing slow growth. However, since 2011, it has seen a sharp uptick, gaining 800% or about 20% per year, aligning with the NASDAQ's tech-focused surge. Despite recent growth, the overall average yearly return stands at 9.7%, akin to the stock market's long-term performance.
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