There’s no denying AI has again been a captivating theme for investors and technology enthusiasts this year. But that proposition could be ramped up in 2026.
Should that sentiment prove accurate, already high-flying AI-tethered ETFs — including the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM) — could spend even more time in the limelight in the new year. More importantly, QQQ and QQQM could continue delivering the goods for investors in 2026 just as the ETFs have done this year.
What’s pertinent to investors considering QQQ and QQQM is that, as expected, AI is evolving rapidly, with language learning models (LLMs) being a prime example. That progress can speed up adoption, which is material to the plethora of AI enablers residing in the QQQ/QQQM portfolios.
“So, what’s so interesting to me is the technology is evolving very, very quickly. We’ve been writing a lot about the nonlinear rate of improvement of AI. And what’s especially exciting right now is a number of the American labs, the well-known companies developing these LLMs, are now gathering about 10 times the computational power to train their next model,” noted Morgan Stanley’s Stephen Byrd.
QQQ Could Be 2026 Star
Over the past three years, the average return posted by QQQ and the lower fee QQQM is about 127%. That represents a massive advantage over the 81.7% delivered by the S&P 500. As impressive as that is, it might also prompt skeptical investors to wonder about the ETFs’ ability to keep the good times rolling in 2026. In investing, nothing is promised. But the potential is certainly there for QQQ and QQQM to generate more upside in 2026.
“So, it sort of starts with a trickle, but then in 2026, it really turns into something much, much bigger. And then I go back to this point about non-linear improvement. So, what looks like areas where AI cannot perform a task six months from now will look very different,” added Byrd.
Of course, much of the case for AI equities in 2026 will center around adoption, particularly at the industry level. The good news for QQQ/QQQM enablers and hyperscalers is that some marquee industries, including financial services, can derive significant benefits from embracing AI.
“Financial services firms move massive amounts of paper. We take paper in, whether it be an account opening, whether it be a contract. Somebody reads that information, they reason about it, and then they type that information into a system. AI is really purpose built for that,” observed Morgan Stanley’s Jeff McMillan
Originally published on ETF Trends
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