A Nasdaq ETF is an exchange-traded fund that tracks the performance of the Nasdaq stock market or a specific index within it, such as the Nasdaq-100. These ETFs offer investors exposure to major tech and growth-oriented companies like Apple, Microsoft, and Amazon, all in a single investment. Popular Nasdaq ETFs include QQQ and QQQM, which mirror the Nasdaq-100, comprising the 100 largest non-financial companies listed on the Nasdaq exchange.
Investing in a Nasdaq ETF allows for diversification across leading technology and innovation-driven firms, reducing the risk tied to holding individual stocks. They are traded like regular stocks, offering liquidity, transparency, and cost efficiency. However, since they are tech-heavy, they can be more volatile during market downturns or interest rate hikes.
For investors seeking long-term growth and comfortable with some risk, Nasdaq ETFs are a compelling option. They provide an easy way to tap into the performance of the U.S. tech sector.