SPY vs XLII
State Street SPDR S&P 500 ETF Trust vs State Street Industrial Select Sector SPDR Premium Income ETF
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | SPY | XLII | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.35% | |
| AUM | $821.1B | $11M | |
| Dividend Yield | 1.01% | 12.08% | |
| Holdings | 505 | 5 | |
| YTD Return | +12.35% | +11.25% | |
| 1Y Return | +20.15% | +18.93% | |
| 3Y Return (annualized) | +21.69% | - | |
| 5Y Return (annualized) | +12.77% | - | |
| Volatility (annualized) | 15.3% | 11.6% | |
| Max Drawdown | -56.5% | -10.1% | |
| Fund Family | State Street Investment Management | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Jan 22, 1993 | Jul 29, 2025 |
SPY vs XLII Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and State Street Industrial Select Sector SPDR Premium Income ETF (XLII) is a ETF from State Street Investment Management. Over the past year SPY returned +20.15% while XLII returned +18.93%. Year to date, SPY is up 12.35% versus a gain of 11.25% for XLII.
Risk: Volatility and Drawdowns
SPY has been the more volatile fund, with annualized monthly volatility of 15.3% compared with 11.6% for XLII. 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 -10.1% for XLII. 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 0.57. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while XLII 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 12.08% for XLII.
Holdings Overlap
SPY and XLII share 0 holdings out of 506 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, SPY or XLII?
SPY has an expense ratio of 0.09% while XLII 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 XLII?
Over the past year SPY returned +20.15% vs +18.93% for XLII, so SPY leads on 1-year performance. Over the longest common window we track (1 years), SPY annualized +8.79% vs +18.31% for XLII. Past performance does not guarantee future results.
Which is riskier, SPY or XLII?
SPY has been the more volatile fund at 15.3% annualized versus 11.6% for XLII. Worst drawdown: SPY -56.5% vs XLII -10.1%.
Should I hold both SPY and XLII?
SPY and XLII have a monthly-return correlation of 0.57, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and XLII?
SPY and XLII share 0 common holdings with a 0.0% weight overlap. Combined, they hold 506 unique securities.
Which pays a higher dividend, SPY or XLII?
SPY yields 1.01% while XLII yields 12.08%, so XLII currently pays the higher dividend yield.
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