Victory NASDAQ-100 Index (USNQX) is managed by Victory in Columbus, Ohio. Established in 2000, it has $6.50 billion in assets and is overseen by Mannik Dhillon since 2019.
Over the past five years, USNQX has an annualised return of 14.81% and a three-year annualised return of 32.66%, placing it in the top third of its category. Its past returns may exclude some fees, which would reduce performance outcomes when accounted for.
Increased Volatility and Risk
USNQX shows more volatility than its peers with a three-year standard deviation of 15.64%, higher than the category average of 12.26%. Its five-year standard deviation is 19.22%, compared to an average of 13.91%, indicating increased risk over time.
The fund has a 5-year beta of 1.17, suggesting more volatility compared to the broader market. Its 5-year alpha is -0.88, demonstrating challenges in outperforming the S&P 500.
USNQX is a no-load fund with an expense ratio of 0.42%. The minimum initial investment required is $3,000, and subsequent investments must be at least $50. Fees from investment advisors may affect returns but are not included in these calculations.
Market Volatility and Trading Strategies
The NASDAQ-100 has delivered strong returns, but we must acknowledge its higher volatility, as shown by its 1.17 beta. This tendency to outperform in bull markets and underperform in bear markets creates clear opportunities for derivative traders. In the coming weeks, we anticipate this volatility will persist, especially given the current economic climate.
Recent inflation data from January 14th showed a slight uptick to 3.4%, creating some uncertainty about the Federal Reserve’s next move. We have seen this reflected in the CBOE Volatility Index (VIX), which has climbed back to 18 this week after sitting near 14 for most of December 2025. This suggests that option premiums on the index are getting more expensive, rewarding strategies that correctly anticipate large price swings.
Considering the higher implied volatility and the big tech earnings reports scheduled for the end of January, we believe buying straddles on the Invesco QQQ Trust (QQQ) could be an effective strategy. This allows us to profit from a significant move in either direction, which seems plausible given the market’s reaction to earnings surprises throughout 2025. This approach removes the need to correctly guess the direction of the post-earnings drift.
We should also remember the index’s negative alpha, which suggests it sometimes underperforms the S&P 500 on a risk-adjusted basis. For those less certain of a major breakout, a pairs trade of going long S&P 500 futures and short NASDAQ-100 futures could hedge against broader market downturns. This strategy would capitalize on any relative weakness in the tech-heavy index.
Looking back at the fourth quarter of 2025, the NASDAQ-100 index repeatedly met resistance at the 18,500 level. We should use weekly options to place defined-risk bets as we approach this key technical level again. These short-dated options provide a capital-efficient way to trade around specific, upcoming economic data releases or earnings events.
