TQQQ Performance Analysis Recent Trends and Dividend Growth

TQQQ has shown a sharp downward trend since the start of 2025. The ETF is currently priced at $57.79, reflecting a significant 27% drop from its starting price of $79.13 at the beginning of the year. On one trading day alone, the ETF recorded a 5.46% decrease, with a price change of -$3.34.

This price is well below its 50-day moving average of $79.37 and its 200-day moving average of $74.61, signaling ongoing bearish momentum. 

Trading activity has surged during this decline, with recent volumes hitting 119 million shares, almost double the average of 63 million shares. This heightened activity points to investor repositioning rather than enthusiasm about potential gains.

The ETF's current price is also far from its 52-week high of $93.79, hovering closer to the 52-week low of $48.80. Analysts have become more cautious, with some adopting bearish strategies for TQQQ, given the challenges leveraged ETFs face during market volatility. 

This sentiment challenges any notion of TQQQ delivering significant financial gains to investors in the short term.

While TQQQ's price performance has faltered, its dividend program has shown encouraging growth, which may appeal to income-focused investors. The ETF currently offers a dividend yield of 1.74%, with $1.00 per share distributed over the past year. 

This represents annual dividend growth of 56.93%, a notable achievement compared to many traditional dividend-paying investments.

The most recent dividend payment of $0.27541 per share was made on December 23, 2024, marking the largest quarterly distribution of the year. 

Prior payments in 2024 included $0.23021 in September, $0.28278 in June, and $0.21514 in March. Despite this impressive growth, the total dividend amount remains modest when compared to the ETF's price volatility, meaning it is unlikely to offset losses for most investors.

TQQQ adheres to a quarterly payout schedule with a payout ratio of 43.19%, indicating stable dividend coverage even with its high-risk leveraged structure. 

While the dividend growth enhances the ETF’s overall return potential, it does not represent a substantial gain for investors in the midst of market challenges.

Examining TQQQ's historical performance provides valuable perspective on its current struggles. In 2023, the ETF delivered an extraordinary return of 193.1%, followed by a 56.1% gain in 2024. 

These outstanding results contributed to its long-term success, with a 5-year average annual return of 29.5% and a 10-year average annual return of 36.1%.

ProShares marked TQQQ's 15-year anniversary in February 2025, celebrating its position as the world’s largest leveraged ETF, with over $25 billion in assets under management. 

The ETF has also become one of the most actively traded funds in the U.S., attracting both short-term traders and tactical investors. 

However, the celebration of its long-term achievements has been overshadowed by its recent price decline, creating a stark contrast between its past success and current difficulties.

How TQQQ Works and Its Challenges

TQQQ is structured as a 3x leveraged ETF, aiming to triple the daily performance of the Nasdaq-100 Index by using derivatives and debt instruments. This leverage amplifies both gains and losses, as seen during the current market downturn.

One unique aspect of leveraged ETFs like TQQQ is their daily rebalancing process, which can lead to a phenomenon called "volatility decay" or "beta slippage." 

This effect can erode returns in volatile or sideways markets, even if the underlying index eventually moves in the desired direction.

The ETF carries an expense ratio of 0.97%, significantly higher than the 0.2% charged by its non-leveraged counterpart, QQQ. 

This higher fee reflects the operational costs of maintaining leverage. Despite this, TQQQ has historically offered strong returns during favorable market conditions, making it appealing to risk-tolerant investors.

The ETF has experienced a 27% decline since the start of 2025, and its current price remains under significant pressure. While its dividend growth of nearly 57% is impressive, it provides limited relief in the face of substantial price volatility.

The ETF's challenges in 2025 stand in contrast to its stellar historical returns, including triple-digit gains in 2023. This highlights the inherent risks of leveraged ETFs, which are highly sensitive to market conditions. 

For current investors, TQQQ's recent trajectory presents a difficult phase, with key indicators suggesting continued downward pressure in the near term.