SPY tracks the S&P 500, QQQ the Nasdaq 100, DIA the Dow and IWM the Russell 2000 small-cap index. They are among the most liquid instruments in the world, and their quotes function as a real-time thermometer for risk appetite everywhere.
They are also the default yardstick. A portfolio that returned nine per cent in a year the S&P 500 returned twenty-four did not have a good year, and the only honest way to judge an active strategy is against the cheap passive alternative it replaced.
Watch the spread between them. QQQ outrunning SPY means the move is concentrated in large-cap technology; IWM lagging badly while SPY makes highs says the rally is narrow, which historically is a less durable state of the market.