Investors Are Acting As if QQQ Is the Perfect Investment Right Now (And Maybe It Actually Is)

By Austin Smith Published Jan 23, 12:45PM EST

Investors Are Acting As if QQQ Is the Perfect Investment Right Now (And Maybe It Actually Is) — © Andrew Burton / Getty Images News via Getty Images

Shares of the Invesco QQQ Trust (NASDAQ:QQQ) are having a good week, coinciding with a surge in retail investor sentiment on Reddit and X. The fund now carries a social sentiment score of 90, one of the highest readings tracked across all ETFs and stocks. This optimism centers on aggressive options positioning, particularly in the 3x leveraged ProShares UltraPro QQQ (NASDAQ:TQQQ), where traders are betting on near-term upside.

A Viral Win Fuels the Frenzy

Reddit’s r/wallstreetbets has become ground zero for QQQ enthusiasm, driven by a single viral post that racked up over 4,000 upvotes in 48 hours. The post details a trader turning $800 into $49,000 in just over an hour using zero-day-to-expiration (0DTE) call options on QQQ. “Was annoyed I missed the boat on the Greenland rally but seemed to get offered the second chance so swung on the 0dtes,” the trader wrote. “100 x QQQ $615 purchased for $0.08 Sold for $5.03 just over an hour later. CALLS GOD.”

$800 > $49k in one hour.
by u/Cold-Cash-1842 in wallstreetbets

The post sustained a sentiment score of 90 across 11 consecutive data snapshots from Wednesday evening through Friday morning. Options activity on TQQQ has been extraordinary, with daily volumes ranging from 241,000 to 392,000 contracts over the past week, and call options dominating at ratios as high as 66%.

The bullish case for QQQ rests on three pillars:

An infographic titled 'Investors Are Acting As if QQQ Is the Perfect Investment Right Now (And Maybe It Actually Is)'. It displays a 'QQQ Social Sentiment Score: 90'. A section 'Viral Win Fuels the Frenzy' highlights a Reddit post with '$800 > $49k in one hour' and a quote about ODTE calls. 'Aggressive Options Positioning (TQQQ)' shows daily contract volumes between 241,000-392,000, a call dominance of up to 66%, and a focus on short-dated options (ODTE). Two line graphs compare 'QQQ vs. SPY Performance (1-Year & 5-Year)', showing QQQ (blue) outperforming SPY (gray), with QQQ +17% vs. SPY +13% over 1 year, and QQQ +92% vs. SPY +80% over 5 years. A 'Portfolio Concentration & Key Holdings' section includes a donut chart showing the 'Top 3 Composition' as NVDA 8.84%, AAPL 7.55%, and MSFT 6.85%, noting 'Top 3 Holdings = 23% of Portfolio'. A bar chart for 'Sector Allocation (Top Sector)' indicates Information Technology at 50.9%, with 'Heavy Concentration in AI Infrastructure'. The bottom section poses 'The Debate: Sustainable Momentum or Speculation?', discussing retail betting on QQQ and ODTE trades.

Frankly, the bulls may have a point here.

QQQ delivered 17% returns over the past year and 92% over five years, outpacing the SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which returned 13% and 80% respectively.
The fund’s 50.9% allocation to Information Technology and heavy concentration in AI infrastructure (NVIDIA and other AI infrastructure companies) positions it to capture growth in the dominant secular trend.
With a net expense ratio of 0.18% and $407 billion in assets under management, QQQ offers liquidity and cost efficiency that active managers struggle to match.

Performance, Concentration, and What’s Next

QQQ’s top three holdings (NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) at 8.84%, Apple (NASDAQ:AAPL) at 7.55%, Microsoft (NASDAQ:MSFT) at 6.85%) represent 23% of the portfolio, creating meaningful concentration risk. Apple has declined 8.6% year-to-date, while NVIDIA is up just 0.6%.

The key question is whether leveraged options positioning can sustain upward momentum or if the concentration in 0DTE trades signals frothy speculation. Either way, retail traders are betting big that QQQ remains the perfect vehicle for growth exposure right now.

Follow 24/7 Wall St. on Google

About the Author Austin Smith, PhD, MD, CFA →

Austin Smith is a financial publisher with over two decades of experience as an investor, analyst, and advisor. He covers stocks, ETFs, Artificial intelligence and personal finance for 24/7 Wall St. Previously, he spent over a decade at The Motley Fool as a senior editor for Fool.com, portfolio advisor for Millionacres, and launched The Ascent to help reader take control of their personal finances.

His work has been featured on Fool.com, NPR, CNBC, USA Today, Yahoo Finance, MSN, AOL, Marketwatch, and many other publications. He is as an advisor to private companies, and co-hosts The AI Investor Podcast with Eric Bleeker.

When not looking for investment opportunities, he can be found skiing, running, or playing soccer with his children. Learn more about Austin's investment approach here.