IVV vs NDQ: Which ETF To Hold in an Australian Portfolio?

If you’ve been looking to add global shares to your investment mix from Australia, you’ve probably bumped into IVV vs NDQ on the ASX. These two ETFs open the door to top US companies, but they do it in different ways—so understanding each is key for figuring out which one could work best for you.

Introduction to IVV vs NDQ: Understanding These Popular ETFs

IVV is the iShares Core S&P 500 ETF, tracking the S&P 500 index, while NDQ is Beta Shares’ Nasdaq 100 ETF, focused on the Nasdaq-100.

Here’s what sets them apart at a glance:

Why do these ETFs keep popping up on Australian radars? Well, it usually comes down to a few factors:

• Both are easily traded on the ASX (no overseas brokerage required)
• They let you invest in many of the biggest names in the US markets
• IVV emphasises broad-market stability; NDQ concentrates on tech-driven growth
• They offer a way to balance out or tilt your existing portfolio

Picking between IVV vs NDQ is really about your comfort with risk and preference for steady market exposure versus a bigger bet on technology and innovation. Both have a role; the trick is understanding which lines up with your own investment approach.

Before making a choice, it helps to get familiar with what exactly each ETF invests in, how their performance can differ, and the fees or currency quirks that can nibble at your returns. The next few sections will break all that down so you can weigh them up with your own goals in mind.

What Does Each Fund Track? Comparing Indexes in IVV vs NDQ

The most important difference between IVV vs NDQ is the benchmark each fund tracks, which shapes their entire approach to investing in US shares.

IVV follows the S&P 500, offering broad access to the largest 500 companies across the United States. In contrast, NDQ mirrors the performance of the Nasdaq-100, which is made up of 100 non-financial companies, heavily focused on the technology sector and other growth-oriented industries.

Here’s a quick table to help you see the contrast at a glance:

A few structural points set these apart:

• The S&P 500 in IVV covers almost all major industries, from technology and healthcare to consumer goods and even banking.
• The Nasdaq-100, used by NDQ, steers clear of banks and is dominated by technology giants like Apple, Microsoft, and Alphabet.
• NDQ’s index often has bigger swings in value, mostly because tech shares react quickly to market news and trends.

If you’re after wide-reaching exposure to all corners of the US economy, IVV gives you that spread. NDQ, on the other hand, leans hard into technology and innovation – ideal if you want a concentrated bet on what’s next, rather than what’s already established.

Portfolio Composition and Top Holdings: IVV vs NDQ Breakdown

Comparing portfolio make-up is a big step in deciding between iShares S&P 500 ETF (IVV) and Beta shares Nasdaq 100 ETF (NDQ), especially if you’re weighing up global exposure or eyeing a bit more tech focus in your investments. Both funds are available to Australian investors on the ASX and are often discussed among the most popular options alongside others like Vanguard VGS, as evident from the high investor interest in the sector.

IVV spreads your money across 500 of the largest US-listed companies, making it much broader in terms of sector representation. NDQ zeroes in on approximately 100 names – mostly large US technology and innovation-heavy firms – so you’re not getting as much diversification.

Here’s a simple table of the top five holdings in each fund (based on recent figures):

A few things stand out when you compare the two:

• IVV is heavier on financials, health care, and consumer brands, giving it more balance between sectors
• NDQ leans hard into technology, software, and internet companies, so the outcome is more tied to tech performance
• Some companies are in both portfolios, but their weights are often doubled or higher in NDQ

It’s easy to miss how concentrated NDQ becomes; just a handful of stocks can drive most of its returns (and losses). If one sector suffers, it hits NDQ much harder than IVV, which spreads risk more widely.

What you’re really deciding here is whether you’re more comfortable with the broad, steady mix of IVV, or if you’d rather focus on the fast-moving world of NDQ, knowing the ride might be bumpier but potentially faster.

Sector Exposure and Risk Profile Differences in IVV vs NDQ

When you line up IVV vs NDQ, the sector splits jump out immediately. IVV gives you a basket across the whole US market, while NDQ homes in on the fast-moving world of tech and innovation. It’s a big reason these funds feel so different.

Here’s a quick breakdown of major sector weights (rounded figures, as of early 2025):

The main point? You’re getting much more spread with IVV. Banks, healthcare, industrials – they’re all in the S&P 500. NDQ, on the other hand, packs most of your money into just a handful of tech names and related areas.

Think about risk:

• NDQ is much more sensitive to tech cycles. When innovation stocks are in favour, it can fly; at times of tech selloffs, it can fall sharply.
• IVV’s broader base often means smaller swings. If banks or healthcare do well, that steadies the ship even if tech takes a hit.
• Standard deviation, a common risk measure, shows the story: over the past five years, IVV’s standard deviation was about 13%, compared to NDQ’s 17%.

So if your goal is steady broad US exposure, IVV may suit you. If you’re chasing higher growth and can stomach the ups and downs, NDQ is likely the more exciting ride.

Many Australian investors like adding gold or gold ETFs to balance out their tech-heavy holdings. Diversification isn’t just a buzzword; it can really soften the highs and lows of concentrated sector bets, as gold ETFs listed on the ASX show in portfolios over time.

Performance History and Volatility Trends: IVV vs NDQ Analysis

Comparing the performance records of IVV vs NDQ reveals how differently these two ETFs have behaved, especially when markets shift. IVV, which tracks the S&P 500, tends to move in line with the overall American economy, spreading risk across hundreds of large companies. NDQ, focused on the NASDAQ 100, leans hard into tech and innovation stocks — and that shows up in both its returns and its ups and downs over the years.

Here’s a snapshot of their historical performance and risk (standard deviation measured over five years):

• NDQ has outpaced IVV in average returns over the recent five years, but those gains have come with more swings along the way.
• NDQ is historically more volatile than IVV, meaning investors need to tolerate bigger selloffs as well as stronger rallies.
• IVV’s steadier returns are a result of greater sector diversification, helping buffer the impact when one industry struggles.
• NDQ often jumps or drops sharply with tech news or market sentiment, as its top holdings are mostly high-growth companies.
• For long-term investors, higher volatility can mean higher gains, but it isn’t always easy to ride out big drops emotionally.

Picking between IVV vs NDQ isn’t only about chasing the best number; it’s about whether you can stomach the bumps along the way without making knee-jerk decisions. If you value steadiness, IVV usually wins out. But if you’re up for more risk in hopes of a bigger payoff, NDQ becomes the more exciting option.

Fees, Dividends, and Currency Considerations in IVV vs NDQ

When comparing IVV vs NDQ for an Australian portfolio, it’s worth getting into the weeds on fees, dividends, and the currency impact, since these can all chip away at your returns (or sometimes add a bit extra).

• Fee Structure: IVV is a clear winner on the cost front, with one of the lowest expense ratios on the ASX, while NDQ’s management fee is noticeably higher. Over a decade, this gap can turn into hundreds of dollars in lost returns if everything else is equal.
• Dividend Payouts: Neither IVV nor NDQ is a dividend favourite by Aussie standards. US markets generally pay less in dividends, and since NDQ is tech-focused, its yield is even lower than IVV’s. Tech companies are more likely to reinvest profits than pay them out.
• Currency Exposure: Both ETFs buy US-listed companies, so your returns will jump around if the AUD/USD exchange rate moves. Sometimes that’s a help, other times a headache. There are hedged versions of both, giving investors the option to smooth out the bumps from currency moves.
• Brokerage Costs: Don’t forget, switching or topping up either ETF involves brokerage, which can add up over time—especially for regular investors. Broker fees are not included in the management cost tables.

Costs might sound boring, but over the years, even these small differences can add up and really tilt the balance in your portfolio.

For a handy comparison (and updates on which ETFs are currently the most popular with Australian investors), have a look at the round-up of top ETFs in Australia this year. This can help put the fees and yields into context against the market.

In the end, watch out for the hidden impact of all three: a low fee can make up for a low yield, while currency can turn a good year into an average one (or vice versa). If you want to simplify your decision, focus on the part that will matter most for your overall investment plan.

Tax Efficiency and ASX Accessibility for IVV vs NDQ Investors

When choosing between IVV vs NDQ as an Australian investor, tax efficiency and how easily each ETF can be bought on the ASX often become deal-breakers. Both IVV vs NDQ trade on the ASX, which means investors can purchase them like any other local share during market hours.

One key advantage of both ETFs is the simplicity of access—Australian investors don’t need to mess around with foreign accounts to gain US market exposure. Just a regular brokerage account, and you’re in.

Tax Considerations

• IVV and NDQ are both US-domiciled ETFs listed on the ASX, which means US withholding tax applies to dividends. Australian investors typically pay a 15% withholding rate under the tax treaty between the US and Australia if they complete a W-8BEN form.
• Both ETFs distribute income in Australian dollars. Investors should declare this income on their annual tax return.
• Franking credits don’t apply, so investors rely purely on the dividend amount less withholding.

ASX Accessibility

• IVV and NDQ both offer strong liquidity through the ASX, ensuring retail investors get fair pricing and tight spreads.
• You can invest through popular Aussie brokers or platforms such as Vanguard Personal Investor, sometimes saving on brokerage or enjoying easier reporting.
• Compared with buying US-listed ETFs directly, the ASX versions streamline your annual tax slip and paperwork.

For most local investors, ASX-listed versions of IVV vs NDQ mean less hassle at tax time, straightforward currency management, and the ease of trading in your home market. Add in the generally reliable liquidity, and they’re more convenient than their direct US-listed counterparts for everyday Australians.

In summary, both funds hold up well on tax efficiency and ease of access for Australians wanting a piece of the US market through their own stock exchange.

Which ETF Fits Your Australian Portfolio — IVV vs NDQ?

Choosing between IVV vs NDQ comes down to your personal investment plan, risk outlook, and long-term goals. IVV brings broad exposure to the US market, while NDQ targets a growth-driven, tech-heavy sector. Both are found on the ASX, making them very accessible to Australians looking for international equities.

Here’s a look at how they compare in key areas important for locals:

Consider the following when making your choice:

• Fee Sensitivity: Lower fees mean more of your returns stay with you. IVV is noticeably cheaper.
• Diversification: IVV covers more sectors, so single-industry shocks have less impact. NDQ is concentrated but taps directly into the US tech engine.
• Growth vs Stability: NDQ could potentially deliver stronger gains when tech is soaring. IVV is steadier and less prone to sharp swings.
• Currency Impact: Both carry exposure to the AUD/USD rate. You might want to check out options for currency hedging, just like with other international ETFs on the ASX.

If you’re after more balanced, broad-market exposure, IVV often fits as a core holding for many Australians. If instead you want a specific tilt towards tech and aren’t worried about short-term volatility, NDQ could add a splash of growth.

In the end, the right fund is the one you can confidently hold over the years, through ups and downs, knowing it matches your goals and appetite for risk. Many local investors use a mix — IVV for stability, NDQ for a growth kicker.

Not sure whether IVV or NDQ is the best pick for your Aussie portfolio? We break things down in a simple way so you can choose what’s right for you. Want more tips and easy guides? Visit our website and find answers to your investment questions!

Frequently Asked Questions

What is the main difference between IVV vs NDQ?

IVV tracks the S&P 500 Index, which covers 500 of the biggest companies in the United States across many industries. NDQ, on the other hand, follows the Nasdaq-100 Index, focusing mostly on large tech and innovation-driven companies. This means IVV is more diversified, while NDQ is more concentrated in technology.

Which ETF has lower management fees, IVV or NDQ?

IVV has a lower management fee, with an expense ratio of about 0.04%. NDQ’s management fee is higher, usually around 0.48%. Lower fees can make a difference to your returns over time, especially if you plan to invest for many years.

How do currency changes affect IVV vs NDQ for Australian investors?

Both IVV vs NDQ invest in US companies, so their returns are affected by changes in the Australian dollar (AUD) and US dollar (USD) exchange rate. If the AUD gets weaker compared to the USD, your returns in AUD will be higher. If the AUD gets stronger, your returns could be lower. Both ETFs also offer hedged versions to reduce this risk.

Are IVV vs NDQ suitable for long-term investing?

Yes, both IVV vs NDQ can be used for long-term investing. IVV might suit those wanting steady growth with less risk, while NDQ can appeal to those looking for higher growth and are comfortable with more ups and downs, especially from the tech sector.

Do IVV vs NDQ pay dividends?

Both ETFs pay dividends, but the amounts are usually lower than what you might get from Australian shares. IVV’s dividend yield is about 1.5%, while NDQ’s is less than 1%. This is because US companies, especially tech ones, often reinvest profits instead of paying high dividends.

Can I buy IVV vs NDQ directly on the ASX?

Yes, both IVV vs NDQ are available to buy and sell on the Australian Securities Exchange (ASX). This makes it easy for Australian investors to get exposure to US markets without needing a US brokerage account.