SPY vs XLV
State Street SPDR S&P 500 ETF Trust vs State Street Health Care Select Sector SPDR ETF
Quick Verdict
XLV has a lower expense ratio. XLV delivered stronger 1-year returns. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | SPY | XLV | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.08% | |
| AUM | $821.1B | $43.9B | |
| Dividend Yield | 1.01% | 1.56% | |
| Holdings | 505 | 63 | |
| YTD Return | +12.22% | +11.80% | |
| 1Y Return | +20.83% | +27.56% | |
| 3Y Return (annualized) | +21.70% | +10.70% | |
| 5Y Return (annualized) | +12.98% | +6.55% | |
| Volatility (annualized) | 15.3% | 14.2% | |
| Max Drawdown | -56.5% | -40.6% | |
| Fund Family | State Street Investment Management | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Jan 22, 1993 | Dec 16, 1998 |
SPY vs XLV Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and State Street Health Care Select Sector SPDR ETF (XLV) is a ETF from SPDR State Street Global Advisors. Over the past year SPY returned +20.83% while XLV returned +27.56%. Year to date, SPY is up 12.22% versus a gain of 11.80% for XLV.
Over three years, SPY compounded at +21.70% per year against +10.70% for XLV; over five years the annualized figures are +12.98% and +6.55% respectively. Across the full 28-year window we track, SPY has the edge at +8.79% annualized vs +7.57%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
SPY has been the more volatile fund, with annualized monthly volatility of 15.3% compared with 14.2% for XLV. 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 -40.6% for XLV. 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 0.75. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
SPY charges 0.09% per year while XLV charges 0.08%. On a $10,000 position that is $9 vs $8 annually, a gap of $1 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 1.56% for XLV.
Holdings Overlap
SPY and XLV share 59 holdings out of 505 unique holdings combined, representing a 8.8% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, SPY or XLV?
SPY has an expense ratio of 0.09% while XLV charges 0.08%. XLV is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, SPY or XLV?
Over the past year SPY returned +20.83% vs +27.56% for XLV, so XLV leads on 1-year performance. Over the longest common window we track (28 years), SPY annualized +8.79% vs +7.57% for XLV. Past performance does not guarantee future results.
Which is riskier, SPY or XLV?
SPY has been the more volatile fund at 15.3% annualized versus 14.2% for XLV. Worst drawdown: SPY -56.5% vs XLV -40.6%.
Should I hold both SPY and XLV?
SPY and XLV have a monthly-return correlation of 0.75, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and XLV?
SPY and XLV share 59 common holdings with a 8.8% weight overlap. Combined, they hold 505 unique securities.
Which pays a higher dividend, SPY or XLV?
SPY yields 1.01% while XLV yields 1.56%, so XLV currently pays the higher dividend yield.
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