New Nasdaq 500 Tracking ETF Puts Less Into AAPL, MSFT, ORCL, Etc.

By Murray Coleman

ETF provider Global X is expanding its lineup of niche commodities and emerging markets funds to launch two new portfolios that slice and dice the tech-heavy Nasdaq composite index up a little more.

While the popular PowerShares QQQ (QQQ) focuses on the Nasdaq 100, the new Global X Nasdaq 500 (QQQV) expands on that theme by tracking the broader parent index. The result is that leading names in the QQQs such as Apple (AAPL), Microsoft (MSFT) and Oracle (ORCL) get a little less of the overall pie.

Meanwhile, so do sector weights:

QQQ: Technology (67.01%), Consumer Discretionary (15.90%), Health Care (11.05%), Consumer Staples (2.32%), Industrials (2.30%), Telecom (1.10%) and Materials (0.31%).
QQQV: Technology (60.46%), Consumer Discretionary (16.66%), Health Care (13.22%), Industrials (4.22%), Consumer Staples (2.35%), Telecommunications (1.35%), Materials (1.04%) and Energy (0.67%).

As you can see, while both remain tech-heavy funds, QQQV spreads those bets around a little more. The new fund comes with a bigger price tag as well — 0.48% vs. 0.20% for the QQQs.

Consider also that QQQV carries nearly 45% of its weighting in its top 10 names, which are identical to the established QQQ’s 10 biggest stocks. By comparison, QQQ’s top 10 get some 55% of total assets.

Global X also launched today a separate ETF that tracks smaller Nasdaq stocks. The Global X 400 Mid Cap ETF (QQQM) represents a departure from focusing on large caps, which should help separate it a little more from the crowd. It also has an expense ratio of 0.48% per year. QQQM faces established mid-cap ETFs from Vanguard and iShares that track MSCI and S&P benchmarks, respectively, and offer relatively high levels of liquidity at a fraction of the cost.source