Should You Buy the Invesco QQQ ETF With the Nasdaq at an All-Time High? Here's What History Says

By Anthony Di Pizio – Jan 7, 2026 at 5:03AM ESTKey PointsThe Nasdaq is usually the exchange of choice for early-stage technology companies looking to go public. The Nasdaq-100 hosts 100 of the largest nonfinancial companies listed on the Nasdaq, many of which are from the tech sector. The Invesco QQQ ETF tracks the performance of the Nasdaq-100, and it could be a great buy right now even with the index at a record high. These 10 Stocks Could Mint the Next Wave of Millionaires ›NASDAQ: QQQInvesco QQQ TrustMarket Cap$0.0KToday's Changeangle-down(0.88%) $5.43Current Price$623.42Price as of January 6, 2026 at 4:00 PM ETThe Nasdaq-100 has consistently outperformed other indexes like the S&P 500 because of its high concentration of technology stocks.More than 3,500 companies have chosen to go public by listing their shares on the Nasdaq (NDAQ +2.27%) stock exchange. It's typically the destination of choice for early-stage technology companies, because it offers lower fees and fewer barriers compared to alternatives like the New York Stock Exchange. The Nasdaq-100 is an index featuring 100 of the largest nonfinancial companies listed on the Nasdaq. It's dominated by the technology sector with a weighting of more than 60%, because many of the early-stage companies that listed on the Nasdaq decades ago are now worth trillions of dollars. Nvidia, Apple, and Microsoft are just a few examples. The Nasdaq-100 is coming off a 20% gain in 2025, and it's currently trading near an all-time high. The Invesco QQQ Trust (QQQ +0.88%) is an exchange-traded fund (ETF) that tracks the performance of the index by holding the same stocks and maintaining similar weightings, so is it a good buy right now? Here's what history says. Image source: Getty Images. A high degree of exposure to the fast-moving tech sector A company's market capitalization (value) determines its weighting in the Nasdaq-100, meaning larger companies have a greater influence over its performance than smaller companies. However, there is a cap to ensure no single company represents more than 24% of the index, because excessive portfolio concentration can lead to volatility. With that said, the Nasdaq-100 is still very top heavy. The 10 largest positions in the Invesco QQQ ETF have a combined weighting of 51.7%, so they are far more influential than its other bottom 90 holdings.

Advertisement Stock Invesco ETF Portfolio Weighting 1. Nvidia 9.04% 2. Apple 8.01% 3. Microsoft 7.17% 4. Alphabet 7.01% 5. Amazon 4.92% 6. Tesla 3.97% 7. Meta Platforms 3.87% 8. Broadcom 3.26% 9. Palantir Technologies 2.24% 10. Netflix 2.19% Data source: Invesco. Portfolio weightings are accurate as of Jan. 1, 2026, and are subject to change. The above companies operate in some of the most exciting and fastest-growing segments of the technology industry, including artificial intelligence (AI), robotics, autonomous vehicles, and even quantum computing. The 10 stocks have delivered an average return of 346% over the last five years, which is a key reason why the Nasdaq-100 has consistently outperformed the more diversified S&P 500 (^GSPC +0.62%). NVDA data by YCharts I also want to make special mention of Advanced Micro Devices and Micron Technology, which sit just outside the Invesco ETF's top 10 holdings. They had a breakout year in 2025, with their shares soaring by 77% and 239%, respectively. They are shaping up to be two of the most important AI semiconductor companies alongside Nvidia and Broadcom. Although the technology sector is at the heart of the Nasdaq-100, the index does offer a splash of diversification with non-technology holdings like Costco Wholesale, Linde PLC, PepsiCo, and Starbucks. They won't be able to offset a tech-specific market crash on their own, but they can help reduce some of the general volatility in the index. It's always a good time to invest for the long term The Invesco QQQ ETF has produced an average annual return of 10.5% since it was established in 1999. But it delivered accelerated annual returns of 19.3% over the last decade specifically, thanks to the widespread adoption of technologies like enterprise software, cloud computing, electric vehicles, and of course, AI. ExpandNASDAQ: QQQInvesco QQQ TrustToday's Change(0.88%) $5.43Current Price$623.42Key Data PointsDay's Range$618.54 - $624.0252wk Range$402.39 - $637.01Volume177K Those returns account for every sell-off in the Nasdaq-100 along the way, including five bear markets since 1999 (a peak-to-trough decline of 20% or more), which were triggered by economic shocks like the dot-com crash in 2000, the global financial crisis in 2008, the COVID-19 pandemic in 2020, the inflation surge in 2022, and President Trump's "Liberation Day" tariffs in 2025. Volatility is a normal part of the investing journey -- it's the price we pay for the opportunity to earn enormous compounding returns over the long term. The secret to success is to stay the course, and to always maintain a long-term investment horizon of five years or more, which will smooth out the market's wild swings. Therefore, even though the Nasdaq-100 is trading near an all-time high right now, history suggests it might still be a great time to buy the Invesco QQQ ETF for anyone seeking long-term returns.Read NextDec 10, 2025 •By Stefon WaltersQQQ vs. VGT: What's the Better Tech ETF Going Into 2026?Dec 10, 2025 •By Anthony Di PizioShould You Buy the Invesco QQQ ETF With the Nasdaq Near an All-Time High? History Offers a Clear Answer.Dec 3, 2025 •By Leo SunThe Cloud Computing Market Could Surge by 218%: Buy This ETF That Holds a Big Position in AlphabetNov 30, 2025 •By David Jagielski, CPAHere's How Much You'd Need to Invest in the Nasdaq-100 to Get Your Portfolio to $1 Million or More by RetirementNov 5, 2025 •By Anthony Di PizioShould You Buy the Invesco QQQ ETF With the Nasdaq At An All-Time High? History Offers a Clear Answer.Oct 27, 2025 •By Anthony Di PizioMeet the Spectacular Index Fund That Could Turn $200,000 Into $1 Million in Under 20 YearsAbout the AuthorAnthony Di Pizio is a contributing Motley Fool technology analyst covering artificial intelligence, cloud computing, autonomous vehicles, and enterprise software. Previously, Anthony was a licensed fund manager, stock broker, and corporate advisor. He holds a bachelor’s degree in commerce and economics from Macquarie University in Sydney, Australia, along with ASIC RG146 certifications in financial securities and derivatives.TMFAnthonyADSCX@AnthonyADSCStocks MentionedInvesco QQQ TrustNASDAQ: QQQ$623.42 (+0.01%) $+5.43S&P 500 IndexSNPINDEX: ^GSPC$6944.82 (+0.01%) $+42.77*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.Advertisement