Investors Pull $3.9B From QQQ Since Conversion

Investors have pulled $3.9 billion from the Invesco QQQ Trust (QQQ) since the fund began trading as an open-end ETF on Dec. 22, 2025, despite a fee cut tied to the conversion.

As part of the transition, QQQ lowered its expense ratio from 0.20% to 0.18%. But the structural upgrade hasn’t stopped investors from redeeming shares. Since the conversion date, net outflows total $3.9 billion, though the withdrawals likely have little to do with the structural change itself.

Most of the redemptions have occurred in 2026. Year to date, investors have pulled $7.5 billion from the fund, including $4.2 billion over the past week alone. The timing suggests the flows may reflect broader market positioning, including the recent tech selloff tied to concerns about AI-related disruption.

It’s also worth noting that the SPDR S&P 500 ETF Trust (SPY) has seen $16.9 billion in outflows so far this year. Both QQQ and SPY are widely used by traders for tactical exposure, so their flows can swing sharply based on short-term positioning.

From UIT to Open-End ETF

QQQ’s conversion marked the end of its legacy structure as a unit investment trust (UIT). Under that structure, Invesco acted only as sponsor and was unable to collect advisory fees or engage in certain portfolio management activities common among modern ETFs, including securities lending, dividend reinvestment and the use of custom redemption baskets.

The move to an open-end structure modernizes QQQ and brings it in line with most other ETFs.

The approval followed months of investor outreach. Invesco previously adjourned a special shareholder meeting to gather additional votes after initially falling short of required thresholds.

Flows May Reflect QQQM Migration

While some of the recent outflows appear tied to short-term trading activity, there is also a longer-running dynamic at play, with investor migration toward the cheaper Invesco NASDAQ 100 ETF (QQQM).

QQQM charges 0.15%, compared with QQQ’s new 0.18% fee. That 3-basis-point difference amounts to $3 per $10,000 invested annually. That’s small in absolute terms, but meaningful for cost-focused investors.

Since QQQ’s conversion, QQQM has gathered $2.7 billion in inflows. Over the past year, it has attracted $20.2 billion, and over three years, $45.2 billion.

With $72.3 billion in assets, QQQM remains much smaller than QQQ’s $398 billion. Still, its steady growth underscores demand for lower-cost Nasdaq-100 exposure.

Importantly, QQQ’s structural conversion does not eliminate the fee gap. The fund remains slightly more expensive, and for investors who do not require QQQ’s deep liquidity or dominant options ecosystem, QQQM may continue to be the preferred vehicle.