Invesco Expands QQQ Suite With International Innovators ETF

On September 23, Invesco launched the Invesco Nasdaq International Innovators 100 ETF (QQI), a fund that seeks to track the performance of the Nasdaq International Innovators 100 Index. The launch is an effort to expand Invesco’s QQQ Innovation Suite. It provides exposure to non-U.S. large- and mid-cap innovative companies across both developed and emerging markets.

QQI offers non-U.S. exposure to innovative large- and mid-cap companies across developed and emerging markets. The fund selects 100 international stocks based on an “Innovator” score analyzing R&D, revenue growth, and profit margins. International chipmakers anchor the portfolio, led by stakes in TSMC, SK Hynix, and ASML.

The Invesco NASDAQ 100 ETF (QQQM) and the Invesco Nasdaq Next Gen 100 ETF (QQQJ) are considered the most established members of the Suite because of their earlier launch dates (both were launched in October 2020), massive asset accumulation and focus on core market capitalizations. QQQM’s assets under management stands at $109.5 billion, while QQQJ has amassed roughly $1.18 billion in AUM. The former’s offering is identical to QQQ’s mega-cap tech exposure, albeit with a lower 0.15% expense ratio. Meanwhile the latter captures the “next 100” companies on the Nasdaq. QQQJ functions as a highly liquid, mid-cap supporting fund. It’s ideal for investors looking to back emerging market leaders before they advance to the top 100.

QQI uses a rules-based methodology to select 100 stocks from the broader Nasdaq Global Ex US Large Mid Cap Index. Invesco selects companies using an “Innovator” score. They’re ranked on the strength of their research and development investments, rapid revenue growth, and strong profit margins. The index rebalances quarterly in March, June, September, and December has a total expense ratio of 0.29%.

QQI’s top holdings are a mixed bag as far as the type of sectors the companies are a part of. Taiwan Semiconductor Manufacturing Company Limited (TSMC), which is the world’s largest dedicated semiconductor factory, is the fund’s largest holding at 10.71%. In second place is South Korean semiconductor manufacturer SK Hynix Inc., with a 6.06% holding, followed by ASML Holding NV (ASMH), a Dutch supplier of extreme ultraviolet (EUV) lithography systems for semiconductor mass production with a 5.85% holding. Lastly, the fund has a 3.98% stake in Chinese technology conglomerate and the world’s largest video game vendor and gaming investor Tencent Holdings Ltd.