SPY vs XBI
State Street SPDR S&P 500 ETF Trust vs State Street SPDR S&P Biotech ETF
Quick Verdict
SPY has a lower expense ratio. XBI delivered stronger 1-year returns. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | SPY | XBI | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.35% | |
| AUM | $821.1B | $10.6B | |
| Dividend Yield | 1.01% | 0.39% | |
| Holdings | 505 | 157 | |
| YTD Return | +12.22% | +34.58% | |
| 1Y Return | +20.83% | +83.96% | |
| 3Y Return (annualized) | +21.70% | +28.02% | |
| 5Y Return (annualized) | +12.98% | +6.13% | |
| Volatility (annualized) | 15.3% | 27.0% | |
| Max Drawdown | -56.5% | -63.9% | |
| Fund Family | State Street Investment Management | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Jan 22, 1993 | Jan 31, 2006 |
SPY vs XBI Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and State Street SPDR S&P Biotech ETF (XBI) is a ETF from State Street Investment Management. Over the past year SPY returned +20.83% while XBI returned +83.96%. Year to date, SPY is up 12.22% versus a gain of 34.58% for XBI.
Over three years, SPY compounded at +21.70% per year against +28.02% for XBI; over five years the annualized figures are +12.98% and +6.13% respectively. Across the full 21-year window we track, XBI has the edge at +11.88% annualized vs +8.79%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XBI has been the more volatile fund, with annualized monthly volatility of 27.0% compared with 15.3% for SPY. 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 SPY and -63.9% for XBI. 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 0.55. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while XBI charges 0.35%. On a $10,000 position that is $9 vs $35 annually, a gap of $26 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 0.39% for XBI.
Holdings Overlap
SPY and XBI share 8 holdings out of 649 unique holdings combined, representing a 1.6% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, SPY or XBI?
SPY has an expense ratio of 0.09% while XBI charges 0.35%. SPY is the cheaper option. On a $10,000 investment, that is $26 per year of difference.
Which performed better, SPY or XBI?
Over the past year SPY returned +20.83% vs +83.96% for XBI, so XBI leads on 1-year performance. Over the longest common window we track (21 years), SPY annualized +8.79% vs +11.88% for XBI. Past performance does not guarantee future results.
Which is riskier, SPY or XBI?
XBI has been the more volatile fund at 27.0% annualized versus 15.3% for SPY. Worst drawdown: SPY -56.5% vs XBI -63.9%.
Should I hold both SPY and XBI?
SPY and XBI have a monthly-return correlation of 0.55, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and XBI?
SPY and XBI share 8 common holdings with a 1.6% weight overlap. Combined, they hold 649 unique securities.
Which pays a higher dividend, SPY or XBI?
SPY yields 1.01% while XBI yields 0.39%, so SPY currently pays the higher dividend yield.
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