SP500, Nasdaq 100 or ETF portfolio: which strategy to choose?

When you start investing, one question always comes up:
Should we seek maximum performance or aim for a sustainable strategy? Indeed, the real question of this article is: SP500, Nasdaq 100 or ETF portfolio: which strategy to choose? The question is whether it's better to simply invest in an S&P 500, a Nasdaq 100 ETF, or to try to beat the stock market with a few ETFs?

⚠️ The simulations presented in this article are based on average historical returns and observed volatility in the markets.
These examples are neither a forecast nor financial advice, but rather an educational illustration of different investment strategies. Investing can involve the risk of losing money. This article should not be considered investment advice.

Introduction

When you start investing in the stock market, a few questions arise:

• Should we seek maximum performance or build a more diversified and sustainable strategy?

• Is it better to simply invest in an ETF that tracks the S&P 500?

• Should we favor the Nasdaq 100 to benefit more from the growth of large technology companies?

• Is it better to combine several ETFs to create a more personalized portfolio?

In this article, we will compare three investment strategies:

1. 100% S&P 500 with the VOO ETF
2. 100% Nasdaq 100 with the QQQ ETF
3. A portfolio composed of several ETFs, with significant exposure to the United States, but also exposure to large growth companies, global markets, Swiss equities and companies paying high dividends.

The goal is not to determine one strategy that is universally better than others. Rather, it is to understand the advantages, limitations, and historical results of each approach.

⚠️ The simulations presented in this article are based on historical returns observed under certain calculation assumptions. They do not constitute a forecast or financial advice. Past performance is not indicative of future results. Investing in the stock market involves the risk of capital loss.

Example comparing three investors with the same starting amount

Let's imagine three investors.

Everyone invests 100,000 USD at the beginning of the period studied (2016-2025) and retains its investment for ten years.

During this period:

• No investor adds any money
• the dividends are reinvested
• ETFs are held for the long term
• The portfolio, composed of several ETFs, is regularly rebalanced to maintain its initial weightings.

The goal is to understand how much each investor could have earned after ten years with a different strategy.

Later in the article, we will also analyze what might happen if each investor started withdrawing a portion of their portfolio each month as part of a FIRE strategy.

Simulation between three investors: S&P 500, Nasdaq 100 and ETF portfolio

Investor 1 – 100% S&P 500

Allocation

• 100% ETF VOO

VOO is an ETF that tracks the S&P 500 index.

This strategy is extremely simple: the investor buys a single ETF and gains exposure to large American companies.

The S&P 500 comprises approximately 500 large publicly traded companies in the United States. It offers diversification across several sectors, for example:

• technology
• health
• finance
• the industry
• energy

Even though the portfolio contains several hundred companies, it remains fully exposed to the US market.

Characteristic	S&P 500 ETF
Strategy	Diversified in the United States
Number of shares	Approximately 500
Main region	UNITED STATES
Concentration level	Moderate
Volatility	Average
Historic dividends	Approximately 1 to 2 % per year
Number of ETFs	1

👉 This strategy is particularly suitable for investors who are looking for simplicity, good diversification in US equities and wish to avoid managing multiple ETFs.

Investor 2 – Aiming for growth with the Nasdaq 100

Allocation

• 100 % ETF QQQ

QQQ tracks the Nasdaq-100, an index composed of large non-financial companies listed on the Nasdaq.

The Nasdaq 100 is heavily weighted towards technology and growth companies. It includes companies active in:

• software
• semiconductors
• artificial intelligence
• digital services
• telecommunications

The Nasdaq 100 has performed exceptionally well over the past decade. However, its high returns have been accompanied by significant concentration in a few large American companies.

Characteristic	Nasdaq 100 ETF
Strategy	American Growth
Number of shares	Approximately 100
Main region	UNITED STATES
Technology Exhibition	Very high
Volatility	High
Historic dividends	Generally low (approximately 0.5%)
Number of ETFs	1

👉 The Nasdaq 100 may offer superior growth potential, but it can also experience significant declines and long periods of underperformance.

Investor 3 – Diversified ETF Portfolio

I simulated investor 3 with this diversified ETF portfolio:

AND F	Weighting
VOO – S&P 500	30 %
QQQ – Nasdaq 100	30 %
VT – Global Equities	10 %
MGK – Large American Growth Companies	10 %
CHDVD – Swiss Dividend Shares	10 %
VHYL – Global High Dividend Stocks	5 %
VYM – High Dividend US Stocks	5 %
Total	100 %

👉 This strategy combines several approaches:

• 30 % in VOO, to gain exposure to a very large part of the American stock market (approximately 80%)
• 30% in QQQ, in order to focus on the 100 best US growth stocks according to Nasdaq
• 10 % in MGK, in order to increase exposure to large American growth companies
• 10 % in VT, in order to achieve global diversification
• 10 % in CHDVD, in order to add exposure to Swiss companies and Swiss dividends
• 5 % in VHYL, in order to invest in global companies paying high dividends
• 5 % in VYM, in order to add high-dividend American companies.

This portfolio is more complex than VOO or QQQ alone. It contains several thousand underlying stocks thanks to global ETFs.

However, it's important to understand that a high number of stocks doesn't mean the portfolio is perfectly balanced across regions. In fact, approximately 85% of this portfolio is invested in the United States.

The wallet is therefore diversified by the number of companies and it is approximately 15% invested outside the USA, but remains heavily focused on the United States and large American growth companies.

Here is a summary of the portfolio:

Characteristic	ETF portfolio
Strategy	Mixing Growth, Diversification and Dividends
Number of ETFs	7
Number of underlying shares	Several thousand
Main region	United States (approximately 85 %)
International Exhibition (Switzerland included)	Present (approximately 15 %)
Swiss Exhibition	Present (Approximately 7 %)
Volatility	Rather High
Estimated dividends	Approximately 1 % to 1.5 % per year

Summary of the three strategies

Strategy	Approximate number of shares	Dominant region	Complexity	Main objective of the strategy
S&P 500 – VOO	Approximately 500	UNITED STATES	Very weak	US Diversified Growth
Nasdaq 100 – QQQ	Approximately 100	UNITED STATES	Very weak	US growth with high volatility
ETF portfolio	Several thousand	United States with international diversification	Average	US growth, but diversified with a global strategy and high dividends

👉 The ETF portfolio has the largest number of companies and the greatest geographical diversity.

However, one should not confuse diversification And lack of concentration.

The VOO, QQQ, and MGK positions overlap significantly. Large, high-growth US companies represent a very substantial portion of the portfolio.

The 10 main actions of each strategy

Before examining the performance of each strategy, I thought it would be helpful to analyze the top 10 stocks and their weight in the portfolio.

Note that the percentages below are estimates and may change depending on the markets and ETF weightings.

Rank	VOO – S&P 500	QQQ – Nasdaq 100	ETF portfolio
1	Apple – ~7 %	NVIDIA – ~9 %	NVIDIA – ~6 to 7 %
2	Microsoft – ~6 %	Microsoft – ~8 %	Apple – ~6 %
3	NVIDIA – ~6 %	Apple – ~8 %	Microsoft – ~6 %
4	Amazon – ~4 %	Amazon – ~6 %	Amazon – ~4 %
5	Meta – ~3 %	Broadcom – ~5 %	Broadcom – ~3 %
6	Alphabet – ~3 %	Meta – ~5 %	Meta – ~3 %
7	Broadcom – ~2 %	Alphabet – ~5 %	Alphabet – ~3 %
8	Tesla – ~2 %	Tesla – ~3 %	Tesla – ~2 %
9	Berkshire Hathaway – ~2 %	Netflix – ~2 %	Nestlé – ~1 %
10	Eli Lilly – ~1.5 %	Costco – ~2 %	Roche – ~1 %

The ten main actions represent approximately:

• VOO: 35 % to 40 % of the portfolio
• QQQ: 50 % to 55 % of the portfolio
• ETF portfolio: 30 % to 35 % of the portfolio

👉 The Nasdaq 100 is the strategy most concentrated on large technology companies.

The ETF portfolio has less exposure to the top 10 stocks and also international exposure; for example, we see Swiss stocks in the top 10. This is not the case with the VOO or QQQ ETFs.

However, it remains heavily exposed to large American companies such as the VOO ETF or QQQ.

👉 The ETF portfolio is therefore more diversified than QQQ and VOO., but its performance remains largely influenced by large American growth companies.

S&P 500 vs Nasdaq 100 vs ETF portfolio

Simulation of historical returns

Let's imagine that the three investors had placed 100,000 USD at the beginning of the period studied.

Note that they did not add any additional money and reinvested all dividends.

For this comparison, we use ten-year estimates (2016-2025):

Strategy	Estimated annualized compound return
VOO – S&P 500	Approximately 14.8 %
QQQ – Nasdaq 100	Approximately 19.5 %
ETF portfolio	Approximately 15.5 %

The return of the ETF portfolio is an estimate based on the historical performance of the ETFs that compose it, with regular rebalancing.

Results may vary depending on:

• the exact dates used
• the frequency of rebalancing
• the reference currency

However, we conclude that the order of returns is:

1. QQQ
2. ETF portfolio
3. S&P 500

The ETF portfolio has historically outperformed the S&P 500. However, it has remained significantly behind the Nasdaq 100 during this period.

However, caution is necessary.

The last decade has been particularly favorable to major American technology companies. The Nasdaq 100 has benefited from this trend. However, this does not automatically mean it will be the best investment over the next ten years.

Simulation in figures with an initial investment of USD 100,000

Here is a simplified simulation based on estimated annualized returns, assuming an initial investment of USD 100,000.

Initial amount	Strategy	Estimated annualized return	Theoretical amount after ten years
100,000 USD	S&P 500 – VOO	14,8 %	Approximately USD 397,000
100,000 USD	Nasdaq 100 – QQQ	19,5 %	Approximately USD 592,000
100,000 USD	ETF portfolio	15,5 %	Approximately USD 422,000

These amounts are theoretical and assume:

• a one-time investment of USD 100,000
• reinvestment of dividends
• no withdrawal
• no tax
• No brokerage fees
• no exchange fees

The difference between the ETF portfolio and VOO would therefore be relatively small over ten years. Although the ETF portfolio gained approximately $25,000 more over 10 years, that's not insignificant.

However, the gap with QQQ would be much larger.

This shows the power of compound interest: a few percentage points of annual return can produce a considerable difference after several years.

Why did the ETF portfolio perform better than VOO?

The wallet contains:

• 30 % of QQQ
• MGK 10 %
• 30 % from VOO

It is therefore heavily exposed to large, growing American companies. During the period studied, these companies experienced very strong growth.

The portfolio also benefited from shares in VT, CHDVD, VHYL and VYM, which provide more diversification, stability and relatively high reinvested dividends.

However, these more diversified or dividend-oriented ETFs also reduced the maximum portfolio performance compared to a strategy invested solely in QQQ.

As they say,”You can't win everywhere”.

👉 The portfolio of various ETFs therefore sought a compromise between growth, diversification and income.

And the proof is that it worked, because the return was slightly better than the S&P 500 for better diversification.

FIRE simulation: what happens with a monthly withdrawal?

The FIRE strategy generally consists of accumulating enough capital to finance some or all of one's expenses through one's portfolio.

In this simulation, let's imagine that each investor withdraws 0.5 % of his portfolio each month. This corresponds to a theoretical annual withdrawal rate of approximately 6 %.

Many FIRE sites suggest withdrawing 4% per year to reach FIRE, as this is considered more prudent. However, for the purposes of this article, let's use the example of a withdrawal of 0.5% per month (6% per year).

FIRE simulation with a monthly withdrawal of 0.5 %

Let's imagine that the three investors start with an initial capital of 100,000 USD and remove 0.5 % of the value of their portfolio each month for ten years.

Dividends are reinvested and no new contributions are made.

This simulation uses the historical annualized returns estimated in this article. Taxes, fees, and inflation are not taken into account.

Estimated result after ten years

Initial amount	Strategy	Estimated annualized return	Estimated final value
100,000 USD	S&P 500 – VOO	Approximately 14.8 %	Approximately USD 218,000
100,000 USD	Nasdaq 100 – QQQ	Approximately 19.5 %	Approximately USD 325,000
100,000 USD	ETF portfolio	Approximately 15.5 %	Approximately USD 232,000

During this historic period, the three investors reportedly continued to grow their capital despite monthly withdrawals.

The ranking would therefore be:

1. QQQ – Nasdaq 100: around 325,000 USD after 10 years
2. ETF portfolio: approximately USD 232,000 after 10 years
3. VOO – S&P 500: approximately 218,000 USD after 10 years

The Nasdaq 100 would have delivered the best performance thanks to its superior historical return. The ETF portfolio would have come in second, slightly ahead of the S&P 500.

However, these results remain a simulation based on average historical returns. Markets move erratically, and future performance could be very different.

👉 This simulation shows that a withdrawal of 0.5 % per month, calculated on the current value of the portfolio, would have allowed the three strategies to continue to grow their capital during the period studied.

However, this simulation should be taken as an estimate, as the stock market varies according to several criteria (inflation, taxes, stock exchange fees, etc.).

FIRE simulation with real stock market fluctuations

The previous simulation used an average annual return applied regularly. However, the stock market does not move in a linear fashion.

Between January 2016 and December 2025, the markets experienced several periods of strong growth, but also significant declines, notably in 2018, 2020 and 2022.

For this new simulation, we take into account the historical fluctuations observed during the period studied.

Every investor starts with 100,000 USD and remove 0.5 % of the value of his portfolio each month. Dividends are included and withdrawals are made after portfolio performance.

Here is the estimated result after ten years:

Strategy	Estimated value after ten years
S&P 500 – VOO	Approximately USD 225,000
Nasdaq 100 – QQQ	Approximately USD 335,000
ETF portfolio	Approximately USD 240,000

The ranking remains the same, and we conclude that the final result is even better for each strategy:

1. Nasdaq 100 – QQQ: around 335,000 USD
2. ETF portfolio: approximately USD 240,000
3. S&P 500 – VOO: around 225,000 USD

It should be noted, however, that this period was particularly favorable for US stocks and large growth companies. These historical results do not guarantee future performance.

👉 This simulation is more realistic than a calculation based on a constant annual return, because it takes into account periods of rising and falling markets.

How do I withdraw money from my ETF portfolio each month?

With VOO or QQQ, withdrawing 0.5 % per month from the portfolio is very simple. The investor owns only one ETF and can sell a small portion of their position when they wish to withdraw money.

The diversified portfolio contains seven ETFs. Therefore, it is necessary to determine which ETFs to sell.

A simple method is to use withdrawals to rebalance the portfolio.

For example :

• If QQQ has increased significantly and represents more than 30% of the portfolio, the investor can sell a portion of QQQ.
• If MGK has become overweight (more than 10% in this case), it can also be sold.

This method allows you to withdraw money each month while gradually bringing the portfolio back towards its target allocation.

Taxation: growth or dividends

Taxation varies considerably depending on the country of residence. It's also important to note that each investor's tax situation is different.

In Switzerland, dividends are often taxed more heavily than capital gains.

Therefore, to summarize, The least taxed stock market strategy is the one that earns the most capital gains and receives the fewest dividends.

In this case, The Nasdaq 100 is the strategy that has paid less dividends than VOO or Investor 3's diversified portfolio, and has historically achieved the best return.

Which investment has the lowest fees?

The annual management fees, called TER, are generally low for the ETFs studied.

• The VOO ETF (S&P 500) has a very low TER of 0.03%

• QQQ is more expensive than VOO, but its fees remain modest compared to many active funds (0.20%)

• The portfolio composed of several ETFs has a weighted average cost that depends on the fees of each ETF; in this example, the average ETF fees are estimated at 0.10%

Summary of fees

Strategy	Number of ETFs	Ease of management	Potential management fees
VOO	1	Very high	Very weak (0.03%)
QQQ	1	Very high	Quite weak (0.20%)
ETF portfolio	7	Average	Weak (approximately 0.10%)

👉 VOO is the simplest and least expensive strategy to manage.

Conclusion: S&P 500, Nasdaq 100 or ETF portfolio: which strategy to choose?

Here is a summary of the three strategies.

Question	Best Strategy
The easiest portfolio to manage	VOO or QQQ
The portfolio with the most stocks	ETF portfolio
The greatest geographical diversification	ETF portfolio
The best historical performance over the period studied	QQQ
The best historical compromise between growth and diversification	ETF portfolio
The lowest-cost strategy	VOO
The least technology-focused strategy	VOO
The strategy most focused on large growth stocks	QQQ
The most complex strategy to manage	ETF portfolio

Key takeaways from this article

The Nasdaq 100 achieved its best historical performance during the period studied..

However, it is also more concentrated and heavily dependent on the performance of large, growing US companies.

The S&P 500 offers a very simple, inexpensive, and relatively diversified solution within the US market.

The portfolio composed of VOO, QQQ, VT, MGK, CHDVD, VHYL, and VYM has historically outperformed VOO. However, it has underperformed QQQ over the past decade.

Compared to VOO or QQQ ETFs, this portfolio offers a better balance between high-growth US stocks, international exposure, an allocation to Swiss equities, and a dividend-oriented component. It also delivers a slightly higher return than the VOO ETF.

However, it should be noted that it remains heavily focused on the United States and on large growth companies due to the overlap between VOO, QQQ, MGK, VT and VYM.

👉 The diversified portfolio is a very good compromise for aggressive investing, with a balance between the VOO, QQQ, VT, VYM and CHDVD ETFs. But it is also the most complicated portfolio to manage.

In summary, it is a US growth portfolio complemented by global, Swiss and high-dividend stocks.

FAQ: S&P 500, Nasdaq 100 and ETF Portfolio

❓ S&P 500 or Nasdaq 100: which one to choose to start with?

For a beginner investor, the S&P 500 may be easier to understand.

It offers exposure to approximately 500 major American companies and encompasses several economic sectors.

The Nasdaq 100 is more geared towards technology and growth companies.

It may offer higher yield potential, but it may also experience greater fluctuations.

👉 To start with a simple and diversified strategy in the United States, the S&P 500 can be an interesting solution.

❓ Is the Nasdaq 100 too risky for the long term?

The Nasdaq 100 isn't necessarily too risky for all investors. However, it is more concentrated than the S&P 500.

It is heavily dependent on the performance of certain large growth companies.

An investor must be able to:

• withstand sharp declines; ;
• preserve your investment during difficult times; ;
• avoid selling in a panic; ;
• accept that a strong past performance may not be repeated.

❓ Can you achieve financial freedom with an S&P 500 ETF?

Yes.

It is possible to achieve financial freedom with a portfolio consisting mainly of an S&P 500 ETF.

Success depends primarily on several factors:

• the amount invested; ;
• the savings rate; ;
• the investment period; ;
• annual expenses; ;
• the yield obtained; ;
• the withdrawal rate.

👉 It is not necessary to beat the Nasdaq 100 to achieve a FIRE target.

❓ Is the portfolio of seven ETFs truly diversified?

Yes, it is diverse in terms of the number of companies and regions. However, it also contains a lot of overlap.

VOO, QQQ and MGK own several large American companies in common.

VT and VYM also add exposure in the United States.

The portfolio is therefore more diversified than an investment solely in QQQ or VOO, but it remains heavily oriented towards large American companies.

❓ Should growth or dividends be prioritized for FIRE?

It depends on each investor's preferences and situation.

During the accumulation phase, the total growth of the portfolio is greater than the level of dividends.

During the withdrawal phase, dividends can provide a regular income and reduce the need to sell shares.

However, a dividend is not a free return. The total return remains the main element.

👉 A portfolio combining growth and dividends can offer an attractive compromise, but it is not automatically more efficient.

❓ Is withdrawing 0.5 % per month realistic?

A withdrawal equivalent to approximately 6 % per year may be high for a very long retirement.

The result depends in particular on:

• of future performance; ;
• inflation; ;
• of the duration of retirement; ;
• expenses; ;
• of the order of returns.

A poor period at the beginning of retirement can significantly reduce the lifespan of the portfolio.

On financial freedom websites, it is often stated that a withdrawal of 4% per year (0.333% per month) is more suitable for becoming financially free.

❓ Is a diversified portfolio necessarily more profitable?

No.

Diversification is primarily aimed at reducing the risk associated with a company, sector, or region.

It does not guarantee superior performance.

A concentrated portfolio can perform better during certain periods. However, it can also experience larger declines.

❓ Should we try to beat the market?

For many investors, trying to beat the market can lead to:

• more expenses; ;
• more transactions; ;
• timing errors; ;
• a strategy that is more difficult to maintain.

A simple and disciplined strategy can be more effective than a constant pursuit of top performance.

❓ What strategy is suitable for a minimalist investor?

A minimalist strategy should be:

• easy to understand; ;
• easy to manage; ;
• inexpensive; ;
• adapted to the investor's risk level; ;
• sufficiently diverse.

A single ETF may be sufficient for some investors.

Others will prefer to build a more personalized portfolio.

👉 The best wallet is not universal.

It's the one that matches your objectives and that you are able to hold onto during a stock market crash.

And you, what strategy would allow you to remain calmly invested during a drop of 30 or 40? 🤭

Example between 3 investors with the same starting amount

To answer that question concretely, I simulated 3 investors, each with 100,000 USD, invested 10 years ago in different strategies.

The goal is to understand how much money each investor would have today (December 2025) with their stock market strategy?

Note that dividends are reinvested in each strategy !

Later in the article, we will also see what happens when we withdraw money each month from each stock market investment 😉

Simulation between 3 investors – (SP500, Nasdaq 100 and diversified portfolio)

Investor 1 – Investing simply with an S&P 500

• 100% ETF S&P 500 (VOO)*

👉 An ultra-simple strategy, very popular among long-term investors.

In reality, with this strategy, the shareholder invests in the 500 best American (USA) stocks.

Here is a table to summarize this strategy:

Sector-based or diversified investment strategy	Diversified
Shares invested	500 US stocks
Investment region	USA
Volatility	Average
Dividends expected	1.4% per year

Investor 2 – Aiming for performance with the Nasdaq 100 (QQQ ETF)

• 100 % ETF Nasdaq-100 (QQQ)*

👉 High exposure to technology and growth, but also more volatility.

In reality, with this strategy, the shareholder invests in the 100 best American (USA) stocks according to the Nasdaq.

Here is a table to summarize this strategy:

Sector-based or diversified investment strategy	Poorly Diversified
Shares invested	100 US stocks
Investment region	USA
Volatility	Very high
Dividends expected	0.5% per year

Investor 3 – Diversified ETF portfolio (SP500, Nasdaq and global)

• 25 % VOO (S&P 500)
• 25 % QQQ (Nasdaq-100)
• 10 % VT (world)
• 10 % VGT (US tech)
• 5 % SMH (semiconductors)
• 5 % VHYL (high dividends worldwide)
• 5 % VOOG (US growth)
• 5 % CHDVD (Swiss dividends)
• 5 % MGK (mega-caps growth US)
• 5 % VYM (high US dividends)

👉 A more complex, but balanced strategy between growth, diversification and dividends.

In reality, with this strategy, the investor mixes high-growth ETFs, sector ETFs in technology, mixed-growth ETFs, high-dividend ETFs, global ETFs and a regional ETF (in this case, the CHDVD which invests in Swiss shares).

Here is a table to summarize this strategy:

Sector-based or diversified investment strategy	Highly Diverse
Shares invested	More than 2,200 shares
Investment region	Global (but with a high percentage in the USA)
Volatility	high
Dividends expected	1.2% per year

If we analyze the number of shares and the investment regions, here is a summary of the three strategies.:

	Number of shares invested	Investment region
SP500	500 shares	100% USA
Nasdaq 100	100 shares	100% USA
Investor 3	More than 2,200 shares	~ 85% USA ~ 6% Switzerland ~ 9% Rest of the world (excluding Switzerland and the USA)

👉 We conclude that investor 3 probably has the most diversified stock portfolio and the one that contains the most stocks.

SP500 VS Nasdaq 100 VS ETF Mix

Return simulation: SP500 vs Nasdaq 100 vs ETF portfolio

I imagined that the three investors had invested $100,000 USD ten years ago. Since then, they haven't invested a single cent of their own money. In reality, they've simply reinvested the dividends they've earned.

Note that the objective for the 3 shareholders is to promote a simple passive investment with a stock portfolio of ETFs.

For investor 1, I considered the VOO ETF which tracks the S&P 500. For investor 2, I considered the QQQ ETF which tracks the Nasdaq 100.

According to the official website of each ETF, here is the return over 10 years (from the end of 2015 to the end of 2025):

• ETF VOO (SP500) = 14% annualized over 10 years, according to the Vanguard website

• ETF QQQ (Nasdaq 100) = 19% annualized over 10 years, according to the Invesco website

Regarding investor 3, I asked ChatGPT for investor 3's average annualized return:

• Investor 3 (ETF Mix) = 15.2% annualized over 10 years

👉 We have a first surprise with investor 3. Although their portfolio is more diversified and contains 4.5 times more stocks than the SP500 ETF, investor 3's long-term return is approximately 1% higher per year.

Numerical simulation of the return on investment for the 3 investors

I went to Moneyland's compound interest calculator. Then, I simulated the return of each stock market strategy over 10 years. Remember that the initial amount is USD 100,000.

Initial amount	Strategy	Annualized return over 10 years	Final amount (10 years later)
100,000 USD	SP500	14%	USD 370,000
100,000 USD	Nasdaq 100	19%	USD 569,000
100,000 USD	ETF Mix	15,2%	USD 411,000

During the period analyzed, we conclude that the ranking regarding past performance is:

1. Nasdaq ETF
2. Investor 3 (ETF Mix)
3. S&P 500 ETF

FIRE simulation: performance of SP500 ETFs, Nasdaq 100 and mixed portfolio with monthly withdrawal of 0.5%

Important – About simulations
The graphs and results presented in this article are simulations based on average historical returns and realistic volatility.
They do not exactly reproduce real markets month by month and serve only to illustrate possible behaviors of different strategies.

I created a graph using historical data. Specifically, I created a graph showing the performance of each investor. However, I simulated a monthly withdrawal of 0.5% (6% per year)!

Indeed, in this simulation, each investor withdrew 0.5% per month from their stock portfolio (dividends included).

How much would each investor have after 10 years (using figures from the end of 2015 to the end of 2025)? 🥸

Here is the graph:

In this case, according to the simulation performed using historical yields:

• Investor 1 (S&P 500), by withdrawing 0.5% from their portfolio per month, would have approximately USD 200,000 10 years later.

• Investor 2 (Nasdaq 100), by withdrawing 0.5% from their portfolio per month, would be approximately $340,000 USD 10 years later.

• Investor 3 (ETF Mix), by withdrawing 0.5% from their portfolio per month, would be approximately $240,000 USD 10 years later.

👉 Over the period studied (2015-2025), we conclude that the Nasdaq 100 strategy is the most effective for achieving FIRE (financial freedom), followed by the mixed ETF strategy, and the S&P 500 in last place.

Simulation of the return for the 3 investors, with a monthly withdrawal of 0.5% (realistic values)

We analyzed the previous graph, which was very interesting. However, he is not realistic as a shareholder!

In reality, The stock market experiences periods of market depression and sharp rises. As a result, returns are highly irregular. !

Consequently, I asked ChatGPT for a chart that uses the actual monthly stock values, from November 2015 to November 2025, removing 0.5% from the portfolio each month.

We will understand that each strategy reacts very differently compared to the previous graph!

👉 In this example, we observe that during the first 3 years, the 3 strategies have similar returns. However, from the 40th month onwards, the Nasdaq 100 and the mixed ETF strategy increase sharply in value, particularly the Nasdaq 100!

Here is the final yield:

• Nasdaq 100 = 490,000 USD, 10 years later
• ETF mix = USD 240,000, 10 years later
• SP500 = $120,000 USD, 10 years later

For investor 3 (ETF mix), how to withdraw each month?

With regard to an S&P 500 ETF or a Nasdaq 100 ETF, it's simple to withdraw 0.5% each month. Because there's only one ETF!

However, in this example, the ETF mix strategy includes 10 ETFs. How do you know which ETF to withdraw each month?

For a long-term investment, in reality, simply withdraw according to market growth !

For example, during a stock market depression, it is better to withdraw 0.5% per month from high dividend ETFs, while during a strong rise, it is better to withdraw 0.5% from growth ETFs.

Most importantly, in my opinion, It involves selling a small percentage of your stock market strategy each month, maintaining a balance between:

• Maintaining a sensible stock portfolio strategy
• Adapting to the value of the stock market

In terms of taxation, which investor will pay the least tax?

In Switzerland and in most countries, promoting stock market growth is taxed less compared to high dividends!

Therefore, if the stock market taxation in your country of residence is similar to the Swiss tax framework, The investor who achieves the most stock market growth and receives the fewest dividends will be the big winner in terms of stock market taxation. !

Here, according to historical data, are the dividends received and the growth of each strategy for the period studied:

Strategy	Dividends received per year (on average)	Annual growth without dividends
SP500	1,5%	12,5%
Nasdaq 100	0.5%	18,5%
Investor 3 ETF Mix	1,2%	14%

👉 In conclusion, regarding taxation, during the period I analyzed, for a Swiss resident, the Nasdaq 100 is the least taxable, followed by investor 3 (ETF mix), while the S&P 500 is the least attractive of the three strategies. !

Which investment has the lowest commissions??

In relation to commissions and annual management fees, all 3 investments have acceptable commissions.

Regarding the trading account, if with each investment, the shareholder invests once a month in a cheap trading account, the fees related to the trading account will be around 3 USD or 0.5% + exchange fees.

Regarding TER management (ETF management fees), here is how much the shareholder will pay for each strategy.

• ETF VOO (SP500) = 0.03%
• ETF QQQ (Nasdaq) = 0.20%
• ETF mix (investor 3) = ∼0.12%

👉 We conclude that the S&P 500 ETF is the most attractive in terms of fees. However, all three stock market strategies have very low fees.

Conclusion – SP500, Nasdaq 100 or ETF portfolio: which strategy to choose?

Here is a table to summarize this article. S&P 500, Nasdaq 100, or ETF portfolio: which strategy should you choose? 😉

	SP500 ETF, Nasdaq 100 ETF or ETF Mix?
The most diversified investment?	Investor 3 (ETF mix)
The investment with the most stocks?	Investor 3 (ETF mix)
Historically, which investment makes it easiest to achieve FIRE?	1) Nasdaq ETF 2) ETF Mix 3) SP500 ETF
Which investment is subject to the least taxation?	1) Nasdaq ETF 2) ETF Mix 3) SP500 ETF
Which investment requires the fewest commissions?	ETF SP500
Which investment has the least price fluctuation?	ETF SP500

-> Key takeaways from this article:

• To achieve FIRE (Financial Incentive Reduction) during the analyzed period, the best strategy is the Nasdaq ETF. Furthermore, it's the least taxable investment. However, it's also the most volatile and least diversified investment!

• Investor 3, who mixes growth ETFs and high dividend ETFs, obtained, during the period compared, a return higher than that of the SP500.

• In this scenario, investor 3 paid less tax on returns compared to the S&P 500 ETF. However, investor 3 paid more tax than the Nasdaq ETF.

• Investor 3 is the most diversified of the three strategies. It holds at least four times more shares than the others and is the only investment to allocate approximately 15% of its portfolio to foreign stocks in the US.

-> Final quote from this article 😎

”The best investment strategy is not always the one that generates the most profit, but the one that best adapts to the stock market.”

AI FAQ – Investing: Maximum Performance VS Sustainable Strategy ?

FAQ – S&P 500, Nasdaq 100 and FIRE strategy

❓ SP500 or Nasdaq 100: which one to choose to start with?

For a beginner investor, the S&P 500 is generally more suitable.
It offers broad sector diversification, moderate volatility and exposure to the largest American companies.

THE Nasdaq 100, more focused on technology, can offer superior performance over certain periods, but with greater fluctuations, sometimes difficult to bear psychologically.

👉 For a smooth start, the S&P 500 is often the best choice.

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❓ Is the Nasdaq 100 too risky for the long term?

The Nasdaq 100 is not “bad” in the long term, but it is more volatile.
Over some decades, it can significantly outperform… and over others, experience long periods of stagnation or sharp declines.

👉 It is particularly suitable for investors who are able to:

• withstand strong variations
• remain invested during downturns
• accepting a strong dependence on the technology sector

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❓ Can you achieve financial freedom (FIRE) with an SP500 ETF?

Yes, absolutely.
Many investors have achieved financial freedom by investing primarily in the S&P 500, thanks to:

• American economic growth
• the effect of compound interest
• a long-term investment discipline

👉 The key is not to beat the market, but to stay invested long enough.

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❓ Should growth or dividends be prioritized for FIRE?

It depends on your stage of life.

• Accumulation phase Growth is often more efficient
• Withdrawal phase Dividends provide greater psychological stability

A mixed portfolio (growth + dividends) often allows you to reduce stress while maintaining good yield potential.

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❓ Is withdrawing 0.5 % per month realistic?

A withdrawal of 0.5 % per month (6 % per year) is possible, but it carries risks, especially in the event of sharp market declines at the beginning of the withdrawal period.

👉 The main danger is the sequence of returns risk :
In other words, withdrawing money during a bad period can greatly impact long-term capital.

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❓ Is a diversified portfolio necessarily more profitable?

No.
Diversification primarily reduces the extreme risk, not necessarily the maximum yield.

A highly diversified portfolio can:

• better withstand crises
• to offer a more comfortable experience
• reduce emotional errors

👉 In frugal investing, performance must be sustainable, Not spectacular.

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❓ Should we try to beat the market?

In most cases, no.

Numerous studies show that:

• beating the market in the long term is difficult
• Simplicity is often more effective.
• Costs, emotional errors, and timing do more damage than poor performance.

👉 Do less, but better, is often the best strategy.

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❓ What is the best strategy for a minimalist investor?

A strategy:

• easy to understand
• easy to maintain
• adapted to your stress level
• aligned with your lifestyle

👉 The best wallet is not universal,
👉 This is the one that You can hold on during difficult times.

And you, what strategy would allow you to sleep soundly during a stock market crash? 🤭

SP500, Nasdaq 100 or ETF portfolio: which strategy to choose?

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Overall, this blog lives on sharing a frugal and minimalist lifestyle.

For a question of transparency towards the readers. All recommended products are in order to make life cheaper, simpler and to promote the essentials.

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About me

I decided to create this blog to develop and help readers who are looking for a simpler and more economical life.

Compared to before, I was a person who consumed a lot until the day I realized that my consumption made me sadder and poorer 😑

Now I prefer the minimum of my needs to be happy and achieve my financial freedom.

Without realizingI started to focus on saving and investing to depend on a boss for as little time as possible and to speed up my personal projects.

For several years I have felt happy and I have become richer in a way that I would never have imagined given that I have an average salary in Switzerland.

It is for this purpose that I decided to create this blog. In order to share and learn with other people who seek freedom and simplicity 😉

Are you rather minimalist or frugal Jonny?

I am as minimalist as I am frugalist. However, there are situations where I lean more towards an art of life.

To conclude, I think the most important thing is to feel comfortable in your lifestyle 😊

SP500, Nasdaq 100 or ETF portfolio: which strategy to choose?