The Nasdaq 100 ETF Just Cut Half Its Holdings And The Timing Is Probably Perfect

"The Nasdaq-100 is dominated by a handful of massive companies, with the top three accounting for more than 20% of the index. That concentration creates a problem: when those few stocks stumble, the entire index feels it. QQEW exists to solve that problem by giving every company equal weight, spreading risk across the full portfolio rather than betting on a few giants."

"QQEW's recent performance illustrates the tradeoff inherent in equal-weighting. The fund's 12.4% gain over the past year lagged the traditional index because 2025 was a year of concentrated mega-cap dominance. When a handful of tech giants drive most market returns, equal-weighting means missing that concentrated rally. The strategy shines when market leadership rotates beyond the largest names. The long-term picture shows a different dynamic, with QQEW delivering strong absolute returns over the past decade."

QQEW equal-weights exposure across selected Nasdaq-100 companies to reduce mega-cap concentration risk. In late December 2025 the fund shifted from holding all 101 Nasdaq-100 constituents to selecting 50 companies based on quality and growth scores while maintaining equal weighting among chosen holdings. Equal-weighting caps each position at roughly 1.4%, giving smaller innovators the same portfolio influence as the largest names. The approach spreads risk away from a handful of giants and transforms the index into a diversified play on Nasdaq-100 innovation. The fund lagged in 2025 amid mega-cap dominance but has delivered strong absolute returns and greater long-term stability.

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