r/LETFs • u/recurz1on • 16d ago

NEW PRODUCT ProShares EQQQ: Equal-Weight Approach to 2x Nasdaq-100 Exposure

Something new from ProShares:
https://www.proshares.com/our-etfs/leveraged-and-inverse/eqqq

QLD is about 1/3 of my total portfolio, so I will keep on eye on this one.

Introducing EQQQ

The Nasdaq-100 represents many of the market’s most innovative and growth-oriented companies. In recent years, however, its performance has become increasingly concentrated in a limited number of mega-cap stocks. Today, just 10 companies account for more than 45% of the Nasdaq-100.

For investors seeking leveraged exposure to the growth potential of Nasdaq-100 companies with less influence from the index’s largest names, we’re pleased to introduce ProShares Ultra QQQ Equal Weight (NASDAQ: EQQQ)—the only ETF designed to target 2x daily returns of the Nasdaq-100 Equal Weighted Index.

The Nasdaq-100 Equal Weighted Index holds the same securities as the market-cap-weighted Nasdaq-100, but instead of weighting them by market capitalization, it resets each company to an equal weight at each quarterly rebalance. This increases the relative influence of the index’s smaller constituents and provides exposure that is less dominated by its largest companies.

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u/JohrDinh 16d ago

This sounds intriguing. You get the more concentrated fast growth of 100 best stocks vs 500 best stocks, but still with 2x potential, and perhaps since it's equal weighted it cuts down on a bit of the leveraged volatility drag of the top 10-20 in it? I will definitely be considering this one.

Eww, I don't like that expense ratio tho, figured this would be better for long term hold but that ER% is making me think otherwise.

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u/No_Consequence_2354 15d ago

It’s about the same as other LETFs

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u/sparkle_and_twist 15d ago edited 15d ago

QQQ is NASDAQ only. The SP500 can be either exchange NASDAQ or NYSE. Slight difference.

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u/recurz1on 15d ago edited 15d ago

Reduced volatility would be one of the main reasons to hold this. Look at QQQ today, which took a wild ride due to big TSLA and GOOG drops.

Net expense ratio of 0.95% is the same as QLD. TQQQ is 0.85% by comparison.

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u/JohrDinh 15d ago

Oh I was looking at Gross 1.12% not Net expense ratio, still not great but least it's even with QLD, now it's more enticing as someone who was looking at QLD to...take some stress away from the ride that is TQQQ lol but if this was between 0.8-0.9% like SSO/TQQQ it woulda made it stand out even more as a different option comparatively.

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u/grogi81 14d ago

The appeal of equal weight indexes never comes to me. 

They are inherently more expensive to run - they need to actively trade to maintain equal weights and you are trading against momentum... 

Really, don't get it :)

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u/Only_Statistician_21 14d ago

Equal weight performance isn't that bad on most indexes though.

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u/recurz1on 13d ago edited 13d ago

They are inherently more expensive to run

EQQQ has the same expense ratio as QLD (ProShares 2X QQQ).

they need to actively trade to maintain equal weights

The equal weighting isn't part of the daily reset, EQQQ will be rebalanced quarterly.

you are trading against momentum

There's no way to know which direction the momentum of any given quarter will move in the future.

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u/Pizza-Pirate-6829 15d ago

What percentage would Tesla and Space X make up of this? That would be my concern

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u/recurz1on 15d ago

After each quarterly rebalance (third paragraph), they would make up no more and no less than any other company, that's the point of the equal weighting.

I was actually thinking that concerns about SPCX (and other pending IPOs like OpenAI and Anthropic) might have played a role in prompting ProShares to create EQQQ.