Subject: Re: OT: big companies
Well, QQQE ain't that. It continuously sells winners and buys losers. Over the long term, hard to see how it can beat "buy all components once, in equal measure, and hold forever".

Bear in mind that different time frames have different properties.

They are selling winners and buying losers only on the time scale of quarterly price fluctuation, which is (as I have measured) a modestly profitable activity on average.
Most short term squiggles are transient, though certainly not all of them.

But over the long haul, the index membership gradually evolves.
It is based on sorting by market cap, but not too frequently, and with a "fuzz" around the limit to avoid buy-high-sell-low at the boundary.
(membership requires entering the biggest 100, but you don't get tossed out till dropping below #105, so it's pretty sticky)
New successful firms are added, very long run winners remain members, and firms not keeping up get tossed out. So at a longer time scale it's the reverse effect, keeping winners and cutting losers.

The thing that interests me is how the economics work.
In any rational world, the set of "the 100 biggest companies that aren't financials and happen to be listed on our exchange" does not make sense as a recipe for higher than average earnings growth over time.
Some would be great, but you'd also expect your fair share of duds, netting out to ... average. Nature abhors a vacuum, and markets abhor a get rich quick scheme.
Yet the trend of average earnings within the Nasdaq 100 set has (barring dips in recessions) risen at a rate that has been remarkably consistent, and shockingly higher than for the S&P 500.
Average earnings (which is what the value of QQQE tracks) have been rising around inflation plus 6-8% for decades now.
That dwarfs the equivalent figure for the S&P 500.
Even a substantial slowdown (which any rational person should expect) would leave the Nasdaq 100 set as the clear leader.

Jim