Buy-and-hold investing is a style that, in certain market settings, can invite criticism. Yet it’s one that’s served scores of investors well over the years. It’s also a style well-suited for many market participants, particularly those not seduced by market or sector timing. Investing for the long term is well-suited for those looking to embrace growth stocks. Enter the Invesco NASDAQ 100 ETF (QQQM).
QQQM, which tracks the venerable Nasdaq-100 Index (NDX), came to market just over three years ago as the buy-and-hold answer to the popular Invesco QQQ Trust (QQQ). Since then, QQQM has grown to a $15.96 billion behemoth. That has been aided by its 0.15% annual expense ratio.That is 5 basis points lower than what’s found on QQQM. Alone, that favorable fee makes QQQM relevant to long-term investors, but there’s more to the ETF’s story.
QQQM Relevant Right Now
The Nasdaq-100 is up 45% year to date. So QQQM has clearly rewarded investors that have been engaged with the ETF since the start of the year. Backed by investors’ enthusiasm for the artificial intelligence (AI) theme, QQQM could be a candidate for more long-term upside. That indicates investors would do well to hold the ETF rather than moving in and out of it based on temporary broader market whims.
Large- and megacap “stocks might struggle in the near term because many investors have already loaded up on them. But tech investors, especially those who bought earlier this year, should hold them for the long term. Many are at the center of the emergence of AI or simply stand to benefit from the continued growth of the overall software business,” reported Jacob Sonenshine for Barron’s.
Among the growth stocks recommended as solid buy-and-hold ideas in the Barron’s article is Credit Karma and TurboTax parent Intuit (NASDAQ: INTU). That stock accounts for 1.25% of the QQQM roster.
“Small-business revenue, based on a few million customers today, can grow about 16% annually for the next two years at least, according to consensus estimates. There are more than 30 million small businesses in the U.S., according to the Small Business Administration, so the growth can continue for many years. It’s Intuit’s fastest-growing segment,” according to Barron’s.
Microsoft (NASDAQ: MSFT), QQQM’s second-largest holding, and Adobe (NASDAQ: ADBE), the ETF’s fifth-largest tech component, were also mentioned by Barron’s. Those two stocks combine for 12.71% of QQQM’s portfolio.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.