One Short- and One Long-Term ETF for Quantum Computing Bulls

Key Points

• Pure-play quantum computing stocks like D-Wave Quantum and IonQ have declined sharply this year, even as broader enthusiasm for the sector remains strong.
• The WisdomTree Quantum Computing Fund offers a narrow, less liquid basket of quantum-focused companies suited to long-term, higher-risk investors.
• The Defiance Quantum ETF diversifies into machine learning and AI holdings, providing greater liquidity and stronger year-to-date returns for shorter-term investors.

Share declines for companies with an exclusive focus on quantum computing have been significant this year—D-Wave Quantum Inc. NYSE: QBTS has dropped a dismal 23% year-to-date (YTD), for instance, while even better-faring rivals like IonQ Inc. NYSE: IONQ are still down 5%. A perfect storm of threats from larger rivals (or up-and-coming new names), continued struggles with marketability and profit, and uneven revenue performance have prompted many companies in the space to slump.

This isn't to say that quantum computing as a sector is dead—in fact, enthusiasm for the industry may be as high as ever before, based on influxes of cash from the federal government and renewed attention from major tech firms. The big issue for many investors is timing—quantum computing may still have years to go until it is widespread and lucrative.

This is why investors seeking broad-based quantum exchange-traded funds (ETFs) to access the industry must consider their time horizon. Fortunately, funds exist for both long- and short-term focuses.

A Long-Term Candidate: WQTM

For investors looking at quantum as a buy-and-hold or other long-term strategy, an ETF like the WisdomTree Quantum Computing Fund BATS: WQTM may be a place to start. WQTM only launched in the fall of 2025, making it one of the newer tech funds available to investors. It has a narrow focus on quantum computing, with a basket of fewer than 50 companies dedicated to the technology.

It is precisely this focus that makes WQTM a candidate for investors with longer time horizons. While WQTM does hold plenty of larger tech firms including Dell Technologies Inc. NYSE: DELL and Intel Corp. NASDAQ: INTC, it primarily targets companies directly involved in the development of quantum technology. Investors should therefore expect volatility in these constituent stocks—and in WQTM—as the industry continues to grow.

Another reason WQTM may be good for traders planning to hold is that it is not the most liquid tech fund available—it has about a third of a billion dollars in managed assets and a one-month average trading volume below 500,000 shares. Neither is tiny, but broader tech funds are available with much larger asset and trading volume figures for investors more focused on liquidity.

With an expense ratio of 0.45%, WQTM is somewhere in the middle of the road for niche tech-sector funds, though more expensive than many investors will look for in the broader ETF world. It may be an option for investors with a higher risk tolerance, or for those who believe it will continue to outperform—it currently boasts YTD returns above 30%.

Notably, the fund may have been buoyed by holdings with broader roles beyond quantum in the tech space.

A Shorter-Term Play: QTUM

The ups and downs of the quantum space in its earlier days can mean the potential for short-term wins for investors willing to take the chance. The Defiance Quantum ETF NASDAQ: QTUM has performed quite well, with 38% YTD returns despite sector-wide volatility, making it an attractive option for investors seeking quick wins.

One reason QTUM's performance has deviated from the share price declines of individual quantum companies is that it also focuses on machine learning companies—this fund provides access to quantum firms, yes, but also to makers of embedded AI chips, and to software firms building tools for data management, perception, and more. With 86 holdings, QTUM has a broader basket than WQTM but still represents just a small slice of the tech space overall.

QTUM also has a greater emphasis on equalizing the weights of its positions than WQTM. The fund has no single position accounting for more than about 2.4% of the portfolio, which may help it to seek out positive returns when they are available and cushion against declines.

This fund's managed asset base of $5.4 billion and one-month average trading volume above 540,000 shares also supports a greater liquidity thesis than WQTM, although it is far from the largest or most heavily traded tech fund. Part of this advantage could be due to its lower expense ratio of 0.4%, while performance may also be a factor, as it has solidly outperformed both WQTM and the S&P 500 so far this year. QTUM has been down for the last month amid the industry-wide dip, revealing that it cannot entirely avoid these issues. However, those willing to take on this volatility may be nicely rewarded.