If I Could Invest in Just 1 ETF in 2026, Here's Where I'd Buy
Key Points
QQQM passively tracks the Nasdaq-100 for a low fee.
It could easily outperform the S&P 500 for the foreseeable future.
In a CNBC interview eight years ago, Warren Buffett said, "If you're going to do dumb things because a stock goes down, you shouldn't own a stock at all." He also noted that "some people are not actually emotionally or psychologically fit to own stocks."
Buffett is right. Many investors can't hold a stock through a 50% drawdown without hastily cutting their losses and missing out on its future multibagger gains. Many investors can't tune out the near-term noise and separate the long-term winners from the stagnating losers.
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Therefore, if you want to stay invested but don't want to deal with the drama of individual stocks, it's smarter to invest in exchange-traded funds (ETFs). ETFs are baskets of stocks that track an index or industry, and they're either passively or actively managed. Unlike index funds, which are only traded once a day, ETFs can be actively traded throughout the day like a regular stock.
What's the best ETF to buy in 2026?
If I could only pick one ETF for 2026, I'd buy Invesco's NASDAQ 100 ETF (NASDAQ: QQQM), the newer, lower-fee version of the Invesco QQQ Trust (NASDAQ: QQQ).
Both of these funds passively track the Nasdaq-100 index, which includes the 100 largest non-financial stocks listed on the Nasdaq Composite (NASDAQINDEX: ^IXIC). However, QQQM's 0.15% expense ratio is lower than QQQ's 0.18%.
QQQM's top holdings include Nvidia, Microsoft, Amazon, Apple, and Broadcom. Those are also the largest companies in the S&P 500 (SNPINDEX: ^GSPC), but those higher-growth tech stocks account for a larger percentage of the Nasdaq-100 than the S&P 500.
The Nasdaq-100 doesn't include many of the S&P 500's slower-growth stocks, nor does it include any of its financial stocks -- since those companies are more dependent on interest rate cycles instead of innovation, organic growth, or market demand. The index is also adjusted quarterly and fully reconstituted annually to add more winners and drop losers, so its investors will always be exposed to the largest and fastest-growing companies in America.
Over the past five years, QQQM has delivered a total return of 98% with reinvested dividends, beating the Vanguard's S&P 500 ETF (NYSEMKT: VOO) total return of 84%. QQQM will be more volatile than VOO or other S&P 500 ETFs, but it can also generate larger long-term gains due to its greater exposure to high-growth stocks. That makes QQQM a solid choice for investors who want a simple ETF to buy, hold, and forget about for a few years.
Leo Sun has positions in Amazon and Apple. The Motley Fool has positions in and recommends Amazon, Apple, Broadcom, Microsoft, Nvidia, and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.