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The Invesco QQQ Trust Recently Hit a New All-Time High. Is It Still a Good ETF to Buy Right Now?

Source The Motley Fool

Key Points

The Invesco QQQ Trust has historically been a good option for growth investors for its exposure to leading tech stocks.
Many tech stocks have bloated valuations these days due to hype related to artificial intelligence.
In the past five years, the Invesco QQQ Trust has more than doubled in value.
10 stocks we like better than Invesco QQQ Trust ›

Investing in the top stocks on the Nasdaq exchange has historically been a great move for long-term investors. The Nasdaq-100 index is popular because it gives investors exposure to the top growth stocks on the exchange, and that has resulted in tremendous gains in recent years.

The Invesco QQQ Trust (NASDAQ:QQQ) tracks the Nasdaq-100, and over the past five years, it has more than doubled in value, outpacing the S&P 500, which has risen at a more modest rate of 77% during that same time frame.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »

However, recently, the Invesco ETF hit a new all-time high, and it comes at a time when the market is growing concerned about artificial intelligence (AI) stocks and a potential bubble that could burst in the near future. Is the ETF still a good buy right now, or has it gotten too risky?

Financial analyst points to a rising stock chart on a large monitor in a bright office.

Image source: Getty Images.

Is there an AI bubble?

This is arguably the biggest question in the markets right now: whether there is an AI bubble. Bullish investors and tech CEOs will say there isn't, that this is a new tech revolution, and that there's much more growth ahead.

There are also plenty of naysayers, including Michael Burry, who famously predicted the subprime housing crash. He knows a thing or two about crashes, and Burry has shorted AI stocks and recently said he believes the bubble will burst sooner than he expected.

Tech companies have invested heavily in AI on the expectation that the growth opportunities will justify their expenditures. But if that doesn't end up happening, they could indeed have far to fall. Palantir Technologies, which is one of the most valuable AI companies with a market cap of around $450 billion, trades at a monstrous price-to-earnings multiple of 160; investors are expecting tremendous growth ahead for the business.

Meanwhile, a stock such as Micron Technology trades at a seemingly low valuation (just seven times its projected future earnings), but that's based on the assumption that demand will remain robust for its products, thanks again, due to AI.

These are just some examples of where there's considerable risk on the Nasdaq these days.

Why I'd avoid the Nasdaq-100 right now

The Nasdaq-100 tracks the most valuable non-financial companies on the Nasdaq, which will inevitably include many overvalued stocks. Holding a position in an index of highly valued stocks at a time when valuations are high simply doesn't appear to be all that enticing an option these days. Interest rates are on the rise again, and the market may be overdue for a pullback. These are precisely the types of stocks that could be vulnerable to corrections.

There are far safer stocks and investments to consider right now. While the Nasdaq-100 has done well in recent years, it may be running out of steam.

Should you buy stock in Invesco QQQ Trust right now?

Before you buy stock in Invesco QQQ Trust, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Invesco QQQ Trust wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $383,680!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,382,954!*

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*Stock Advisor returns as of September 29, 2026.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology and Palantir Technologies. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.

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