TQQQ and SPXL Compare Tech Focus Versus Broad Market

ProShares - UltraPro QQQ (NASDAQ:TQQQ) and Direxion Daily S&P 500 Bull 3X Shares (NYSEMKT:SPXL) are popular leveraged exchange-traded funds (ETFs) that aim to triple the daily return of major U.S. equity indexes. While TQQQ follows the Nasdaq-100 index, SPXL tracks the broader S&P 500 -- making this a matchup of tech-heavy leverage versus broad market exposure.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500.

Both funds carry similar expense ratios and dividend yields, though TQQQ has earned higher returns over the past 12 months with a slightly higher beta, indicating more significant price volatility.

Performance & risk comparison

What's inside

ProShares - UltraPro QQQ delivers 3x daily exposure to the Nasdaq-100, resulting in a concentrated tilt toward technology (55%), communication services (15%), and consumer discretionary (13%) companies. The fund holds stocks from 101 companies, with top positions in Nvidia, Apple, and Microsoft. With a 15-year history and a daily leverage reset, TQQQ requires careful consideration for investment timing.

By contrast, Direxion Daily S&P 500 Bull 3X Shares offers leveraged exposure to the S&P 500, spreading risk across a broader universe of just over 500 holdings. The top holdings are similar—Nvidia, Apple, and Microsoft—but with less concentration. SPXL's daily leverage reset quirk is shared with TQQQ.

For more guidance on ETF investing, check out the full guide at this link.

Foolish take

Both TQQQ and SPXL are higher-risk ETFs, as they aim to outperform the market by a significant margin. Most investments with higher earning potential will come with increased risk for volatility, so this is something investors should consider before buying either ETF.

TQQQ's increased exposure to the technology industry can amplify volatility as well. With over half of the holdings allocated to this sector (compared to around 35% for SPXL), investors could experience more severe fluctuations in the short term with this fund. That said, the tech sector also has the potential for explosive growth, as evidenced by TQQQ's higher total returns over the last year.

If you choose to invest in either of these ETFs, be sure you're comfortable with higher levels of risk and that the rest of your portfolio is well diversified. It's also wise to keep a long-term outlook and plan to hold your investment for at least five years or so, which can help limit risk and reduce the impacts of short-term volatility.

Glossary

Leveraged ETF: An exchange-traded fund using financial derivatives to amplify daily returns, often by 2x or 3x.
Expense ratio: Annual fund operating expenses expressed as a percentage of average assets under management.
Dividend yield: Annual dividends paid by a fund divided by its share price, shown as a percentage.
Beta: A measure of a fund's volatility compared to the overall market, typically the S&P 500.
AUM (Assets Under Management): The total market value of all assets managed by a fund.
Max drawdown: The largest observed percentage decline from a fund's peak value to its lowest point over a period.
Nasdaq-100: An index of 100 of the largest non-financial companies listed on the Nasdaq stock exchange.
S&P 500: A stock market index tracking 500 large U.S. companies across various industries.
Daily leverage reset: The process by which leveraged ETFs rebalance to maintain their target leverage ratio each trading day.
Consumer cyclical: Companies whose sales and profits are sensitive to economic cycles, such as retailers and automakers.
Holdings: The individual stocks or assets owned by a fund or portfolio.

Katie Brockman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.