XNTK Has Crushed QQQ by Six Points in 2026 and the Reason Is Hidden in How Each Fund Decides Which Stocks Matter

QQQ tracks the Nasdaq-100, a market-cap-weighted index of the 100 largest non-financial Nasdaq-listed companies. The index heavily weights major technology firms such as Apple, Microsoft, NVIDIA, Amazon, Alphabet, Meta, and Tesla, while non-tech companies like Costco and PepsiCo can be included because the filter is based on exchange rather than sector. XNTK tracks the NYSE Technology Index, which uses a modified equal-dollar-weighted approach across about 35 leading U.S.-listed technology companies. Equal-weighting reduces megacap dominance and increases influence from mid-cap names. XNTK has outperformed QQQ in 2026 and over the trailing year, especially when returns broaden beyond megacaps. QQQ is cheaper and more liquid, while XNTK charges a higher fee for its different weighting approach.

"QQQ tracks the Nasdaq-100, a market-cap-weighted index of the 100 largest non-financial companies listed on the Nasdaq. That construction is an implicit bet that the biggest names keep getting bigger. Apple, Microsoft, NVIDIA, Amazon, Alphabet, Meta, and Tesla dominate the weight, and non-tech names like Costco and PepsiCo ride along because the index filters by exchange, not by sector."

"XNTK tracks the NYSE Technology Index, a modified equal-dollar-weighted basket of roughly 35 leading U.S.-listed tech companies. Equal-weighting strips power from the megacaps and hands real influence to mid-cap names that QQQ barely registers. The bet is that broader tech participation, not Magnificent 7 dominance, drives the next leg of returns."

"From December 31, 2025 through May 14, 2026, QQQ rose 17.17%, while XNTK climbed 23.63% over the same window. Over the trailing year the spread widened further: XNTK gained 55.87% against QQQ's 38.77%. When the rally broadens past the megacap leadership of 2023 and 2024, equal-weighting wins."

"QQQ is cheaper, deeper, and tradeable in size. XNTK's higher fee is the price of stripping out non-tech ballast and giving smaller tech names a real seat at the table."

Read at 24/7 Wall St.