Whenever I check the price movement during the day, it doesn’t match the actual share price of the Nasdaq 100. It seems extremely delayed but checking the yearly returns, it tracks the Nasdaq 100 perfectly…
Anybody know whats going on?
The EQQQ is priced in GBP whereas the NASDAQ index is priced in USD so if the NASDAQ rises 2% in a day but the GBP drops 1% you actually have those two price movements combine. Does that make sense?
There is also a seperate discussion around the fact that some ETFs often do not own all of the shares in a particular index. For example, with the S&P500 there are a number of relatively small holdings with limited liquidity (relatively to say Apple) and so many ETF providers do not own these because they almost have no impact on the index itself and involve relatively large transaction costs.
4 Likes
I believe EQGB tries to tackle exactly that exchange rate fluctuation:
“To minimise exposure to fluctuations in the exchange rate between USD and GBP, the GBP Hedged share class enters into foreign exchange transactions (typically short dated currency forwards, with the hedge reset daily to 100% of NAV).”
So might be worth looking into if you want it hedged although it does come with a higher management fee. Also, GBP might of course fluctuate in your favour but it is another variable that you have no control of.
2 Likes
Thanks both!