QQQ vs SMH: Correlation
Invesco QQQ Trust (QQQ) and VanEck Semiconductor ETF (SMH) show a very strong relationship: their 3-year correlation of weekly returns is 0.90.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are QQQ and SMH?
Over the past 3 years, QQQ and SMH moved with a correlation of 0.90, which is very strong, meaning they move nearly in lockstep. Recent behaviour matches the longer record: 0.86 over 1 year against 0.90 over 3. Over 5 years the correlation is 0.89, and the annualized covariance of weekly returns is 593.7 %².
Among the 4755 assets we track against QQQ, SMH ranks #14 by 3-year correlation. Correlation aside, the last 12 months split them widely, with SMH ahead by 66.8 points (+26.3% versus +93.1%). The rolling one-year correlation stayed in a tight band between 0.84 and 0.94 over the past three years, which points to a structural rather than episodic relationship. Note the risk asymmetry: SMH runs 1.7 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
QQQ vs SMH: side by side
| QQQ (Invesco QQQ Trust) | SMH (VanEck Semiconductor ETF) | |
|---|---|---|
| 1-year return | +26.3% | +93.1% |
| 5-year return | +95.4% | +332.8% |
| Volatility (ann.) | 19.6% | 33.7% |
| Beta vs S&P 500 | 1.28 | 1.91 |
| Max drawdown (3Y) | -22.8% | -35.7% |
| Dividend yield | 0.44% | – |
| Expense ratio | 0.18% | – |
| Assets under management | $452.8B | – |
| Sector / category | ETF · US Growth & Tech | ETF · Thematic |
QQQ, Invesco's Large Growth fund, carries $452.8B under management, 104 holdings, a 0.18% expense ratio, a 0.44% trailing dividend yield.
Year-by-year returns
| Year | QQQ | SMH |
|---|---|---|
| 2022 | -32.6% | -33.5% |
| 2023 | +54.9% | +73.4% |
| 2024 | +25.6% | +39.1% |
| 2025 | +20.8% | +49.2% |
| 2026 | +17.7% | +59.1% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are QQQ and SMH good diversifiers for each other?
Not really. At 0.90, the two trade almost as one position, and owning both buys little extra protection.
FAQ
What is the correlation between QQQ and SMH?
The QQQ/SMH correlation stands at 0.90 on a 3-year window (1 year: 0.86, 5 years: 0.89), computed from weekly returns as of 2026-08-27.
Is SMH a good diversifier for QQQ?
Not really. At 0.90, the two trade almost as one position, and owning both buys little extra protection.
What does a correlation of 0.90 mean?
Correlation ranges from −1 to +1. Values near +1 mean two assets move together, near 0 that they move independently, and negative values that they tend to move in opposite directions. It measures co-movement, not performance.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/qqq-vs-smh.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/qqq-vs-smh/)
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Related comparisons
Hubs: QQQ correlations · SMH correlations
