Tesla Stock Has More Impact on Some ETFs Than Others
The Consumer Discretionary Select Sector SPDR Fund (XLY) and Invesco QQQ Trust, Series 1 (QQQ), two exchange-traded funds that both own Tesla stock, have been experiencing opposite fortunes in 2026. While XLY is down 5.4% year-to-date, QQQ is up 15.6% over the same period.
The key difference lies in their exposure to Tesla: XLY holds it at 19.6% of net assets, whereas QQQ owns it at just 3.3%. This disparity has significant implications for investors, as fund weights can greatly influence an ETF's performance.
XLY's top three holdings are Amazon (22.2%), Tesla (19.6%), and Home Depot (5.8%). While two of these stocks have declined this year, Amazon's gain has somewhat offset Tesla's decline, resulting in a relatively milder loss for XLY compared to Tesla's standalone performance.
On the other hand, QQQ is more diversified, with top holdings like Nvidia and Apple, which have driven its strong returns. As a result, Tesla's year-to-date drop has had little impact on QQQ's overall performance.