QQQ, SCHG, and SCHD Emerge as 3 Standout ETFs for New Investors in 2026

Last year was another big year for the stock market, as the S&P 500 (SPX) returned 18% and the Nasdaq (NDX) returned roughly 20% on the year for 2025.

Whether you’re looking to get started investing in 2026, or interested in finetuning your existing portfolio, there’s no time like the present, and exchange-traded funds (ETFs) are a simple and effective way to do this as they can offer investors instant diversification and broad exposure to dozens (or hundreds, or even thousands) of stocks all in one simple instrument.

In this article, we’ll discuss three of the market’s top ETFs, the Invesco QQQ Trust (QQQ), the Schwab U.S. Large-Cap Growth ETF (SCHG), and the Schwab U.S. Dividend Equity ETF (SCHD), and why they can be strong building blocks for your portfolio, whether you’re just starting out in your journey as an investor, or a seasoned investor taking a fresh look at your holdings this year.

Invesco QQQ Trust

The Invesco QQQ Trust is a popular $404 billion ETF that invests in the Nasdaq 100 — an index of the 100 largest nonfinancial companies in the U.S. The Nasdaq’s tech-centric focus means investors in QQQ gain instant exposure to dozens of the market’s top tech stocks, including Mag 7 giants like Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Meta Platforms (META), Tesla (TSLA), and Alphabet (GOOGL), plus other formidable technology names like Palantir (PLTR), Broadcom (AVGO), and Micron (MU). While the fund provides significant exposure to big tech, there’s also room for prominent stocks from other sectors, such as Costco (COST), Linde (LIN), and Booking Holdings (BKNG).

Below, you’ll find an overview of QQQ’s top 10 holdings from TipRanks’ holdings tool. 

This formidable portfolio powered QQQ to a standout year in 2025, delivering an impressive total return of 20.8%. That said, strong performance is nothing new for the tech-focused ETF. QQQ has generated exceptional annualized returns of 32.9%, 15.1%, and 19.4% over the past three, five, and 10 years, respectively. While past performance never guarantees future results, QQQ has clearly established itself as a long-term winner. Will it automatically deliver another 20% return in 2025? Of course not—but it remains well positioned to perform strongly over an extended time horizon.

QQQ also carries a reasonable expense ratio of 0.20%, meaning investors pay just $20 annually in fees for every $10,000 invested.

Overall, I’m bullish on QQQ. It’s a powerhouse ETF backed by a high-quality portfolio of blue-chip stocks in the technology sector and beyond, supported by a long and consistent track record of outstanding returns and a moderate fee structure.

Is QQQ a Buy?

Turning to Wall Street, QQQ earns a Moderate Buy consensus rating based on 86 Buys, 15 Holds, and one Sell rating assigned in the past three months. The average QQQ stock price target of $742.53 implies almost 20% upside potential in 2026.

See more QQQ analyst ratings

Schwab Large-Cap US Growth ETF

Like QQQ, the Schwab Large-Cap U.S. Growth ETF delivered strong performance in 2025, posting a total return of 17.5% for the year. And again, similar to QQQ, this result aligns with SCHG’s long history of robust performance. The $53 billion ETF has produced outstanding annualized returns of 33.5%, 15.8%, and 18.2% over the past three, five, and 10 years, respectively. While past performance is never a guarantee of future results, this is the kind of long-term track record that investors can feel confident owning over extended time horizons.

SCHG tracks the Dow Jones U.S. Large-Cap Growth Total Stock Market Index, which aims to provide investors with simple access to large-cap U.S. equities that exhibit growth-style characteristics.

There is significant overlap between SCHG’s top holdings and those of QQQ, as both funds count Nvidia, Apple, Microsoft, Amazon, Meta Platforms, Alphabet, Tesla, and Broadcom among their top 10 positions. That said, SCHG also holds several high-quality, growth-oriented blue-chip stocks not found in QQQ, including Visa, GE Aerospace, and Eli Lilly. This gives investors a familiar growth focus with a slightly different tilt and diversification profile.

In total, SCHG holds 196 stocks, with its top 10 positions accounting for 58.4% of the portfolio. An overview of SCHG’s top 10 holdings is provided below.

SCHG’s appeal is further enhanced through its minuscule expense ratio of 0.04%. This means an investor putting money into the fund today will pay just $4 in fees on a $10,000 investment annually. Not only is that one-fifth the expense ratio of QQQ, but it’s also less than the price of a large coffee or a value meal at a lot of fast food places these days. 

All in all, I’m bullish on SCHG based on its robust portfolio of blue-chip growth stocks, its stellar performance history, and its rock-bottom fee, all of which make it an attractive core holding for long-term investors.  

Is SCHG a Buy?

Turning to Wall Street, SCHG earns a Strong Buy consensus rating based on 177 Buys, 19 Holds, and zero Sell ratings assigned in the past three months. The average SCHG stock price target of $40 implies 22% upside potential in 2026.

See more SCHG analyst ratings

Schwab U.S. Dividend Equity ETF

Another popular Schwab offering, SCHD is a $73 billion, dividend-focused ETF that tracks an index emphasizing the quality and sustainability of dividend payments.

SCHD offers an attractive dividend yield of 3.8%—more than triple the yield of the S&P 500 and well above the modest yields of 0.5% and 0.4% provided by QQQ and SCHG, respectively. While some dividend ETFs advertise even higher yields, SCHD stands out for its emphasis on quality and durability. Rather than chasing headline yields, the fund focuses on financially strong companies with reliable cash flows, helping investors avoid the low-quality yield traps often associated with struggling businesses.

SCHD holds 100 stocks, with its top 10 positions accounting for 40.4% of total assets. An overview of SCHD’s top 10 holdings can be found below.

As you can see, SCHD’s top holdings differ meaningfully from those of QQQ and SCHG. The fund provides exposure to oil majors such as ConocoPhillips (COP) and Chevron (CVX), defense leaders like Lockheed Martin (LMT), and healthcare stalwarts including Merck (MRK) and Bristol-Myers Squibb (BMY). That said, SCHD doesn’t completely avoid technology, as it still holds established names such as Texas Instruments (TXN), Cisco (CSCO), and Skyworks Solutions (SWKS).

From a performance standpoint, SCHD has not matched the growth-oriented results of QQQ and SCHG in recent years. In 2025, the fund returned 4.3%, significantly lagging both of those ETFs as well as the broader market. Its longer-term performance is more respectable, with annualized returns of 6.8%, 8.9%, and 11.5% over the past three, five, and 10 years, respectively, as of the end of 2025. Even so, these figures still trail the results posted by QQQ and SCHG.

Despite this, SCHD remains appealing for its role in a diversified portfolio. The fund offers exposure to more value-oriented, higher-yielding stocks, making it a strong complement to growth-heavy ETFs like QQQ and SCHG. After an extended period of outperformance by growth strategies, there is also a reasonable case for mean reversion, which could eventually bring income- and value-focused funds like SCHD back into favor.

Like SCHG, SCHD is attractive from a cost perspective, with a very low expense ratio of just 0.06%.

Ultimately, SCHD may not appear as exciting on paper as QQQ or SCHG, but it remains a compelling option for investors seeking income, diversification, and balance within a long-term portfolio.

Is SCHD a Buy?

Turning to Wall Street, SCHD earns a Strong Buy consensus rating based on 47 Buys, 46 Holds, and six Sell ratings assigned in the past three months. The average SCHD stock price target of $30.55 implies 7% upside potential in 2026.

See more SCHD analyst ratings

Three Compelling ETFs with 2026 Underway

QQQ, SCHG, and SCHD each bring something different to the table, but all three are compelling ETFs for investors of every experience level as we head into 2026. QQQ provides high-growth exposure to 100 of the Nasdaq’s leading companies and boasts a long track record of outstanding performance. SCHG offers access to nearly 200 blue-chip growth stocks, a similarly impressive history of strong returns, and an ultra-low expense ratio. SCHD, meanwhile, hasn’t delivered the same eye-popping growth as its peers, but it stands out for its reliable dividend income, attractive 3.8% yield, and exposure to a different segment of the market—all at a rock-bottom cost.

These three ETFs can be effective both as standalone investments and when combined as part of a diversified portfolio. For newer investors, they provide a simple, low-cost, and low-maintenance way to achieve instant diversification and exposure to a broad range of high-quality stocks. More experienced investors can also benefit by using them as strong core holdings or as complementary positions to round out an existing portfolio.