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 (+152.08% vs +40.68% 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 | 84.0 |
| Latest close | $659.88 | $740.62 |
| 1M return | +21.31% | +5.57% |
| 6M return | +95.12% | +23.67% |
| 1Y return | +152.08% | +40.68% |
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 | $25.29K (+152.9%) started 2025-06-18 | $14.14K (+41.4%) started 2025-06-18 |
| 5Y ago | $56.79K (+467.9%) started 2021-06-18 | $22.96K (+129.6%) started 2021-06-18 |
| 10Y ago | $280.4K (+2704.0%) started 2016-06-20 | $79.38K (+693.8%) started 2016-06-20 |
Hypothetical — past performance does not guarantee future results.
| Metric | SMH | QQQ |
|---|---|---|
| Expense ratio | 0.35% | 0.18% |
| Total assets (AUM) | $67.82B | $493.99B |
| Dividend yield | 0.18% | 0.38% |
| Trailing P/E | 44.50 | 34.00 |
| Beta | 1.73 | 1.23 |
| 52-week change | 152.08% | 40.68% |
| Metric | SMH | QQQ |
|---|---|---|
| 1Y return | +152.08% | +40.68% |
| 6M return | +95.12% | +23.67% |
| 1M return | +21.31% | +5.57% |
| 1Y Sharpe ratio | 2.77 | 1.78 |
| Beta | 1.73 | 1.23 |
| Dividend yield | 0.18% | 0.38% |
| 5Y CAGR | +40.68% | +17.37% |
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 | +152.08% | +40.68% |
| CAGR | +152.24% | +40.72% | |
| Sharpe ratio | 2.77 | 1.78 | |
| Max drawdown | 14.93% | 11.96% | |
| Max daily drop | 9.22% | 4.80% | |
| Max wkly drop | 10.50% | 6.79% | |
| 5Y | Growth | +450.85% | +122.74% |
| CAGR | +40.68% | +17.37% | |
| Sharpe ratio | 1.01 | 0.63 | |
| Max drawdown | 45.30% | 35.12% | |
| Max daily drop | 9.83% | 6.21% | |
| Max wkly drop | 15.31% | 11.98% | |
| 10Y | Growth | +2445.19% | +639.84% |
| CAGR | +38.25% | +22.17% | |
| Sharpe ratio | 1.01 | 0.81 | |
| 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) | $67.82B | $493.99B |
| Dividend yield | 0.18% | 0.38% |
- →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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