VBR vs XLV
Vanguard Small Cap Value ETF vs State Street Health Care Select Sector SPDR ETF
Quick Verdict
VBR has a lower expense ratio. XLV delivered stronger 1-year returns. VBR offers more diversification with 809 holdings.
Side-by-Side Comparison
| Metric | VBR | XLV | Winner |
|---|---|---|---|
| Expense Ratio | 0.05% | 0.08% | |
| AUM | $36.9B | $42.1B | |
| Dividend Yield | 2.23% | 1.60% | |
| Holdings | 853 | 62 | |
| YTD Return | +18.27% | +9.20% | |
| 1Y Return | +23.85% | +28.53% | |
| 3Y Return (annualized) | +16.25% | +9.18% | |
| 5Y Return (annualized) | +9.89% | +6.43% | |
| Volatility (annualized) | 19.0% | 14.2% | |
| Max Drawdown | -64.0% | -40.6% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Jan 26, 2004 | Dec 16, 1998 |
VBR vs XLV Performance
Vanguard Small Cap Value ETF (VBR) is a ETF from Vanguard (US) and State Street Health Care Select Sector SPDR ETF (XLV) is a ETF from SPDR State Street Global Advisors. Over the past year VBR returned +23.85% while XLV returned +28.53%. Year to date, VBR is up 18.27% versus a gain of 9.20% for XLV.
Over three years, VBR compounded at +16.25% per year against +9.18% for XLV; over five years the annualized figures are +9.89% and +6.43% respectively. Across the full 23-year window we track, VBR has the edge at +8.04% annualized vs +7.48%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VBR has been the more volatile fund, with annualized monthly volatility of 19.0% 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 -64.0% for VBR 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 0.64. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VBR charges 0.05% per year while XLV charges 0.08%. On a $10,000 position that is $5 vs $8 annually, a gap of $3 per year that compounds over a long holding period. On income, VBR currently yields 2.23% against 1.60% for XLV.
Holdings Overlap
VBR and XLV share 12 holdings out of 857 unique holdings combined, representing a 2.7% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VBR or XLV?
VBR has an expense ratio of 0.05% while XLV charges 0.08%. VBR is the cheaper option. On a $10,000 investment, that is $3 per year of difference.
Which performed better, VBR or XLV?
Over the past year VBR returned +23.85% vs +28.53% for XLV, so XLV leads on 1-year performance. Over the longest common window we track (23 years), VBR annualized +8.04% vs +7.48% for XLV. Past performance does not guarantee future results.
Which is riskier, VBR or XLV?
VBR has been the more volatile fund at 19.0% annualized versus 14.2% for XLV. Worst drawdown: VBR -64.0% vs XLV -40.6%.
Should I hold both VBR and XLV?
VBR and XLV have a monthly-return correlation of 0.64, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VBR and XLV?
VBR and XLV share 12 common holdings with a 2.7% weight overlap. Combined, they hold 857 unique securities.
Which pays a higher dividend, VBR or XLV?
VBR yields 2.23% while XLV yields 1.60%, so VBR currently pays the higher dividend yield.
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