Should Fidelity Nasdaq Composite Index ETF (ONEQ) Be on Your Investing Radar?

If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the Fidelity Nasdaq Composite Index ETF (ONEQ), a passively managed exchange traded fund launched on September 25, 2003.

The fund is sponsored by Fidelity. It has amassed assets over $8.77 billion, making it one of the larger ETFs attempting to match the Large Cap Growth segment of the US equity market.

Why Large Cap Growth

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.

Annual operating expenses for this ETF are 0.21%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 0.57%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector -- about 49.4% of the portfolio. Telecom and Consumer Discretionary round out the top three.

Looking at individual holdings, Nvidia Corp (NVDA) accounts for about 11.29% of total assets, followed by Apple Inc (AAPL) and Microsoft Corp (MSFT).

The top 10 holdings account for about 60.3% of total assets under management.

Performance and Risk

ONEQ seeks to match the performance of the NASDAQ Composite Index before fees and expenses. The Nasdaq Composite Index is a stock market index that includes almost all stocks listed on the Nasdaq stock exchange.

The ETF has lost about 4.73% so far this year and it's up approximately 28.52% in the last one year (as of 03/16/2026). In the past 52-week period, it has traded between $60.22 and $94.14.

The ETF has a beta of 1.17 and standard deviation of 19.36% for the trailing three-year period, making it a medium risk choice in the space. With about 1031 holdings, it effectively diversifies company-specific risk.

Alternatives

Fidelity Nasdaq Composite Index ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, ONEQ is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.

The Vanguard Growth Index Fund ETF Shares (VUG) and the Invesco QQQ (QQQ) track a similar index. While Vanguard Growth Index Fund ETF Shares has $191.41 billion in assets, Invesco QQQ has $383.00 billion. VUG has an expense ratio of 0.03% and QQQ charges 0.18%.

Bottom-Line

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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Fidelity Nasdaq Composite Index ETF (ONEQ): ETF Research Reports

This article originally published on Zacks Investment Research (zacks.com).

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