IVV vs XAR
iShares Core S&P 500 ETF vs State Street SPDR S&P Aerospace & Defense ETF
Quick Verdict
IVV has a lower expense ratio. XAR delivered stronger 1-year returns. IVV offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | IVV | XAR | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.35% | |
| AUM | $865.2B | $6.1B | |
| Dividend Yield | 1.09% | 0.28% | |
| Holdings | 508 | 49 | |
| YTD Return | +14.50% | +16.73% | |
| 1Y Return | +22.02% | +33.85% | |
| 3Y Return (annualized) | +21.80% | +34.38% | |
| 5Y Return (annualized) | +13.37% | +19.45% | |
| Volatility (annualized) | 15.1% | 20.4% | |
| Max Drawdown | -56.5% | -46.7% | |
| Fund Family | iShares by BlackRock (US) | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | May 15, 2000 | Sep 28, 2011 |
IVV vs XAR Performance
iShares Core S&P 500 ETF (IVV) is a ETF from iShares by BlackRock (US) and State Street SPDR S&P Aerospace & Defense ETF (XAR) is a ETF from State Street Investment Management. Over the past year IVV returned +22.02% while XAR returned +33.85%. Year to date, IVV is up 14.50% versus a gain of 16.73% for XAR.
Over three years, IVV compounded at +21.80% per year against +34.38% for XAR; over five years the annualized figures are +13.37% and +19.45% respectively. Across the full 15-year window we track, XAR has the edge at +18.14% annualized vs +7.07%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XAR has been the more volatile fund, with annualized monthly volatility of 20.4% compared with 15.1% for IVV. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -56.5% for IVV and -46.7% for XAR. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.76. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
IVV charges 0.03% per year while XAR charges 0.35%. On a $10,000 position that is $3 vs $35 annually, a gap of $32 per year that compounds over a long holding period. On income, IVV currently yields 1.09% against 0.28% for XAR.
Holdings Overlap
IVV and XAR share 12 holdings out of 541 unique holdings combined, representing a 2.1% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IVV or XAR?
IVV has an expense ratio of 0.03% while XAR charges 0.35%. IVV is the cheaper option. On a $10,000 investment, that is $32 per year of difference.
Which performed better, IVV or XAR?
Over the past year IVV returned +22.02% vs +33.85% for XAR, so XAR leads on 1-year performance. Over the longest common window we track (15 years), IVV annualized +7.07% vs +18.14% for XAR. Past performance does not guarantee future results.
Which is riskier, IVV or XAR?
XAR has been the more volatile fund at 20.4% annualized versus 15.1% for IVV. Worst drawdown: IVV -56.5% vs XAR -46.7%.
Should I hold both IVV and XAR?
IVV and XAR have a monthly-return correlation of 0.76, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IVV and XAR?
IVV and XAR share 12 common holdings with a 2.1% weight overlap. Combined, they hold 541 unique securities.
Which pays a higher dividend, IVV or XAR?
IVV yields 1.09% while XAR yields 0.28%, so IVV currently pays the higher dividend yield.
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