## [# Why I Own: EQQQ](/sections/news/why-i-own-eqqq)
# Why I Own: EQQQ
Evrin Erdem, head of investment at Copia Capital Management, talks about why her firm invests in the PowerShares EQQQ Nasdaq-100 UCITS ETF
[](/contributors/rachael-revesz)
[By Rachael Revesz](/contributors/rachael-revesz)
Jun 15, 2015
Edited by: Rachael Revesz
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*\[This article was first published in the Spring 2015 edition of ETF Report UK, our quarterly magazine for UK-based financial advisers. To read the full issue [click here](europe/publications/etfruk/issue/19-spring-2015.html)\]*
Evrin Erdem, head of investment at Copia Capital Management, talks about why her firm invests in the PowerShares EQQQ Nasdaq-100 UCITS ETF.
**ETF.com: When did you start using the PowerShares EQQQ Nasdaq-100 UCITS ETF?**
**Erdem:** We bought it at the beginning of November 2013, so we’ve held it since we launched the firm.
**ETF.com: Why did you choose EQQQ?**
**Erdem:** The Nasdaq-100 is a very good market to get exposure to, in that companies are both blue chip and growing. The US is also in a very good position. The S&P 500 Index did brilliantly last year, but the Nasdaq-100 did even better. In 2014, the Nasdaq-100 delivered 28%, whereas an S&P 500 tracker produced 24% in sterling. And since we bought EQQQ in November 2013, it has made 33% returns, versus the S&P 500’s 27%.
In terms of currency, with the USD strengthening against GBP, investing in ETFs that track an index based in USD added extra performance for the GBP-based investor, which was the case in the second half of 2014.
**ETF.com: What are the attractions of EQQQ?**
**Erdem:** We wanted to get exposure to the Nasdaq-100 in our multi-asset portfolios, and the fund is a good vehicle to get exposure to that index: It’s liquid, it has a large number of assets under management, and its bid/offer spread is very low, around 10 basis points—if that.
This ETF costs 0.30% per year, so that’s not the price of a smart beta product.
It’s true \[that there are concerns around US technology stocks being overvalued\] but these positions will take a while to unwind. The US economic data is doing well—it’s one of the best-performing countries in the world. All eyes are on the Fed and what it will do next, but we aren’t expecting an imminent crash.
**ETF.com: How do you use EQQQ?**
**Erdem:** For our 10 risk-rated, multi-asset portfolios, we hold EQQQ in every portfolio from the fourth on—and even in the third portfolio a little bit—in increasing amounts, up to 15%.
We reconsider what we’re holding every two months, so it’s not like we buy and hold a fund indefinitely.
**ETF.com: Do you find that EQQQ is weighted too heavily in any particular area?**
**Erdem:** The index is heavy on technology. It has all the household names like Microsoft, Apple, eBay and Amazon, which are growing blue chip stocks. EQQQ tracks a modified market cap index, so if one stock exceeds 24%, everything is scaled down to a weight of 20% and distributed towards the smaller stocks.
This ETF excludes financial stocks, but we do have exposure to that sector and we hold an S&P 500 tracker too. Ultimately, we didn’t choose EQQQ to avoid financials.
**ETF.com: What else would you use to replace EQQQ?**
**Erdem:** Amundi and Lyxor both have ETFs tracking this index, but since they’re synthetic, we didn’t consider them.
iShares has a Nasdaq-100 tracker, which is just plain-vanilla exposure, and it’s 10% more expensive than EQQQ, with annual costs of 0.33%. But these are small numbers anyway. Its AUM is smaller, and it reinvests dividends, rather than paying them to investors.
**Risk warning** *With investment comes risk. The price and value of investments mentioned and income arising from them may fluctuate and you may get back less than you invest. A movement in exchange rates may have a separate effect, unfavourable or favourable, on the gain or loss otherwise experienced on the investment concerned. Past performance is not a reliable indicator of future performance.*
[ Rachael Revesz Editor, etf.com Europe ](/contributors/rachael-revesz)
Rachael Revesz joined etf.com in August 2013 as staff writer. Previously an investment reporter at Citywire, she has a background in writing content… [View Bio](/contributors/rachael-revesz)
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