SMH vs QQQ Stock Comparison: AI Score, Valuation, Performance and Upside
SMH offers pure-play semiconductor sector exposure with very high cyclical beta, while QQQ offers broader Nasdaq-100 large-cap growth exposure with meaningful but diluted chip weighting. Investors who want to maximize AI chip cycle exposure choose SMH; investors who want broad large-cap growth with tech and semiconductor exposure as part of a diversified portfolio typically prefer QQQ.
SMH vs QQQ is the decision between maximum semiconductor sector concentration and diversified large-cap Nasdaq growth — SMH amplifies the chip cycle in both directions, while QQQ smooths it with software, consumer, and biotech exposure.
QQQ holds the edge across 4 of 5 key metrics in this comparison. SMH has delivered stronger 1-year price return (+99.01% vs +28.94% for QQQ).
- →prefer a pure-play semiconductor sector position during AI chip supercycle conditions
- →value the inclusion of TSMC and ASML for global semiconductor supply chain exposure
- →want maximum sensitivity to AI data center spending on GPU and accelerator chips
- →are comfortable with higher volatility and deeper drawdowns during semiconductor inventory corrections
- →prefer broad Nasdaq-100 growth exposure across technology, consumer, and healthcare sectors
- →value the lower 0.20% expense ratio and superior options market liquidity for hedging
- →want semiconductor exposure as part of a diversified large-cap growth portfolio without semiconductor cycle concentration
- →are comfortable with FAANGM megacap concentration as the dominant return driver within the fund
| Metric | SMH | QQQ |
|---|---|---|
| ETF score | 76.0 | 81.0 |
| Latest close | $575.71 | $723.85 |
| 1M return | -2.80% | +1.58% |
| 6M return | +41.12% | +15.88% |
| 1Y return | +99.01% | +28.94% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | SMH | QQQ |
|---|---|---|
| 1Y ago | $19.96K (+99.6%) started 2025-08-04 | $12.96K (+29.6%) started 2025-08-04 |
| 5Y ago | $45.26K (+352.6%) started 2021-08-04 | $20.93K (+109.3%) started 2021-08-04 |
| 10Y ago | $219.46K (+2094.6%) started 2016-08-04 | $72.04K (+620.4%) started 2016-08-04 |
Hypothetical — past performance does not guarantee future results.
| Metric | SMH | QQQ |
|---|---|---|
| Expense ratio | 0.35% | 0.18% |
| Total assets (AUM) | $77.2B | $490.1B |
| Dividend yield | 0.17% | 0.41% |
| Trailing P/E | N/A | 32.12 |
| Beta | 1.76 | 1.24 |
| 52-week change | 99.01% | 28.94% |
| Metric | SMH | QQQ |
|---|---|---|
| 1Y return | +99.01% | +28.94% |
| 6M return | +41.12% | +15.88% |
| 1M return | -2.80% | +1.58% |
| 1Y Sharpe ratio | 1.86 | 1.17 |
| Beta | 1.76 | 1.24 |
| Dividend yield | 0.17% | 0.41% |
| 5Y CAGR | +34.43% | +15.22% |
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | SMH | QQQ |
|---|---|---|---|
| 1Y | Growth | +99.01% | +28.94% |
| CAGR | +99.10% | +28.96% | |
| Sharpe ratio | 1.86 | 1.17 | |
| Max drawdown | 24.62% | 11.96% | |
| Max daily drop | 9.22% | 4.80% | |
| Max wkly drop | 14.09% | 6.79% | |
| 5Y | Growth | +339.00% | +103.04% |
| CAGR | +34.43% | +15.22% | |
| Sharpe ratio | 0.87 | 0.54 | |
| Max drawdown | 45.30% | 35.12% | |
| Max daily drop | 9.83% | 6.21% | |
| Max wkly drop | 15.31% | 11.98% | |
| 10Y | Growth | +1892.01% | +570.63% |
| CAGR | +34.88% | +20.96% | |
| Sharpe ratio | 0.93 | 0.76 | |
| Max drawdown | 45.30% | 35.12% | |
| Max daily drop | 14.41% | 11.98% | |
| Max wkly drop | 19.23% | 16.20% |
| Category | SMH | QQQ |
|---|---|---|
| Fund name | VanEck Semiconductor ETF | Invesco QQQ Trust |
| Type | ETF | ETF |
| Expense ratio | 0.35% | 0.18% |
| Total assets (AUM) | $77.2B | $490.1B |
| Dividend yield | 0.17% | 0.41% |
- →100% semiconductor sector concentration gives direct exposure to AI chip demand, data center build-out, and EV semiconductor content growth
- →Includes TSMC and ASML, the two globally dominant advanced chip manufacturing and lithography equipment suppliers
- →Higher beta to AI chip spending cycles than any diversified tech ETF including QQQ
- →Broader diversification across 100 companies in technology, consumer, healthcare, and other sectors reduces single-industry cyclical risk
- →0.20% expense ratio is lower than SMH's 0.35%, saving cost over long holding periods
- →Largest non-S&P 500 ETF by AUM and options market liquidity, comparable to SPY in derivatives depth
- →Semiconductor industry is cyclical — SMH underperforms significantly during inventory correction and PC/smartphone demand downturns
- →0.35% expense ratio is meaningfully higher than QQQ's 0.20%
- →Extreme concentration in 25 names means idiosyncratic stock risk (one major miss) can drive significant drawdowns
- →Heavy concentration in FAANGM-type megacap tech (AAPL, MSFT, AMZN, NVDA, GOOGL, META) — top 10 holdings often exceed 50% of assets
- →Semiconductor exposure is meaningful (~20–25%) but diluted by software and consumer names — investors wanting pure chip exposure should use SMH instead
- →Nasdaq-100 methodology can include non-tech companies that investors may not expect in a 'tech ETF'
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