The Invesco QQQ Trust (QQQ) has been in the news, not for its performance, but due to a structural change. Invesco plans to convert QQQ from its outdated unit investment trust (UIT) structure to a modern open-ended format. QQQ holds the 100 largest non-financial stocks on the Nasdaq, making it a default choice for tech exposure. However, it was not designed specifically as a tech or growth fund.
For investors seeking more focused tech or large-cap growth exposure, the Vanguard Mega Cap Growth ETF (MGK) and the iShares Expanded Tech Sector ETF (IGM) present compelling alternatives. MGK tracks the CRSP US Mega Cap Growth Index, including 69 stocks and offering broader eligibility by incorporating NYSE-listed growth giants like Eli Lilly, S&P Global, and Visa, which QQQ excludes due to its Nasdaq-only focus.
IGM, on the other hand, addresses limitations of traditional tech ETFs that follow GICS sector classifications by tracking a broader index of 280 companies. It also offers a North American perspective, including non-US firms like Shopify, providing exposure beyond typical US-focused ETFs.
