IYW vs XLK
iShares US Technology ETF vs State Street Technology Select Sector SPDR ETF
Quick Verdict
XLK has a lower expense ratio. XLK delivered stronger 1-year returns. IYW offers more diversification with 153 holdings.
Side-by-Side Comparison
| Metric | IYW | XLK | Winner |
|---|---|---|---|
| Expense Ratio | 0.38% | 0.08% | |
| AUM | $25.8B | $124.4B | |
| Dividend Yield | 0.11% | 0.45% | |
| Holdings | 153 | 77 | |
| YTD Return | +23.77% | +27.34% | |
| 1Y Return | +38.61% | +42.34% | |
| 3Y Return (annualized) | +32.83% | +30.61% | |
| 5Y Return (annualized) | +18.73% | +19.29% | |
| Volatility (annualized) | 24.6% | 23.2% | |
| Max Drawdown | -81.9% | -82.0% | |
| Fund Family | iShares by BlackRock (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | May 15, 2000 | Dec 16, 1998 |
IYW vs XLK Performance
iShares US Technology ETF (IYW) is a ETF from iShares by BlackRock (US) and State Street Technology Select Sector SPDR ETF (XLK) is a ETF from SPDR State Street Global Advisors. Over the past year IYW returned +38.61% while XLK returned +42.34%. Year to date, IYW is up 23.77% versus a gain of 27.34% for XLK.
Over three years, IYW compounded at +32.83% per year against +30.61% for XLK; over five years the annualized figures are +18.73% and +19.29% respectively. Across the full 26-year window we track, XLK has the edge at +9.37% annualized vs +8.80%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IYW has been the more volatile fund, with annualized monthly volatility of 24.6% compared with 23.2% for XLK. 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 -81.9% for IYW and -82.0% for XLK. 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 0.98. They move almost in lockstep, so holding both mostly duplicates the same exposure.
Fees and Cost Over Time
IYW charges 0.38% per year while XLK charges 0.08%. On a $10,000 position that is $38 vs $8 annually, a gap of $30 per year that compounds over a long holding period. On income, IYW currently yields 0.11% against 0.45% for XLK.
Holdings Overlap
IYW and XLK share 58 holdings out of 167 unique holdings combined, representing a 76.8% weight overlap.
High overlap means holding both may not provide much additional diversification.
Frequently Asked Questions
Which is cheaper, IYW or XLK?
IYW has an expense ratio of 0.38% while XLK charges 0.08%. XLK is the cheaper option. On a $10,000 investment, that is $30 per year of difference.
Which performed better, IYW or XLK?
Over the past year IYW returned +38.61% vs +42.34% for XLK, so XLK leads on 1-year performance. Over the longest common window we track (26 years), IYW annualized +8.80% vs +9.37% for XLK. Past performance does not guarantee future results.
Which is riskier, IYW or XLK?
IYW has been the more volatile fund at 24.6% annualized versus 23.2% for XLK. Worst drawdown: IYW -81.9% vs XLK -82.0%.
Should I hold both IYW and XLK?
IYW and XLK have a monthly-return correlation of 0.98, so they move almost identically. Holding both adds little diversification - most investors pick one, usually on fees or the specific index tracked.
What is the holdings overlap between IYW and XLK?
IYW and XLK share 58 common holdings with a 76.8% weight overlap. Combined, they hold 167 unique securities.
Which pays a higher dividend, IYW or XLK?
IYW yields 0.11% while XLK yields 0.45%, so XLK currently pays the higher dividend yield.
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