GRNY ETF Outperforms VOO and QQQ with Active Strategy

While 2024 has been a strong year for broad market indices, with both VOO and QQQ posting double-digit returns, the Fundstrat Granny Shots U.S. Large Cap ETF has significantly outpaced these popular benchmarks. GRNY’s 26% year-to-date gain represents substantial outperformance in a market where keeping things simple with index funds has typically been the profitable approach. This performance comes despite concerns about AI bubbles potentially pulling down both VOO and QQQ, as well as brief market turbulence from regional banking scares and tariff jitters that ultimately proved short-lived.

The GRNY ETF’s success is particularly notable given the challenging environment for active management. Historically, beating the S&P 500 and Nasdaq 100 year after year has proven incredibly difficult, making GRNY’s current outperformance all the more impressive. While the ETF hasn’t been around for an extended period, its early success has drawn significant capital inflows, largely attributed to the presence of star strategist Tom Lee as the public face of the fund.

What sets GRNY apart from traditional index funds is its robust yet disciplined methodology. The ETF employs an equal-weight approach that prevents excessive concentration in any single stock, unlike the QQQ where three stocks carry double-digit percentage weightings. This construction methodology ensures that no single holding can disproportionately impact the fund’s performance, creating a more balanced risk profile while still maintaining exposure to powerful growth names.

The fund’s strategic focus combines both short- and long-term thematic investing, with particular emphasis on the current AI boom. However, unlike many tech-heavy funds, GRNY maintains exposure to non-tech AI beneficiaries, providing diversification that could prove valuable if technology stocks face a sell-off. This balanced approach means the ETF holds many of the Mag Seven names necessary for outperformance but without the excessive weighting seen in QQQ, where concentration risk remains a concern.

Perhaps most importantly, GRNY avoids excessive exposure to speculative names that could be vulnerable during market downturns. The disciplined stock-selection methodology focuses on quality large-cap companies positioned to benefit from thematic trends without taking on undue risk. For investors looking beyond the top-10 holdings, the fund’s construction reveals a thoughtful blend of growth opportunities across multiple sectors.

Star strategist Tom Lee’s involvement provides a significant credibility boost to the GRNY ETF. As the public face of the Fundstrat Granny Shots approach, Lee brings his television-proven track record of market calls to the fund’s management. While past performance doesn’t guarantee future results, Lee’s many right calls on market direction have investors optimistic about the ETF’s continued potential.

Looking ahead to 2026, the GRNY appears well-positioned to continue its outperformance. The unique mix of thematic growth names, combined with the equal-weight methodology that prevents overconcentration, creates a foundation for sustained market-beating returns. As the AI boom continues to evolve, GRNY’s exposure to both tech and non-tech beneficiaries could provide an edge over more narrowly focused funds.

The bottom line for investors is that GRNY offers a compelling alternative to traditional index investing. With its disciplined approach, good mix of holdings, and star management, the ETF has demonstrated its ability to give the S&P 500 a run for its money. While the ‘granny shot’ approach might not seem flashy, the improved shooting percentage it offers could make it worth a closer look for investors seeking to enhance their portfolio performance in a challenging market environment.