VCSH vs XLK
Vanguard Short Term Corporate Bond ETF vs State Street Technology Select Sector SPDR ETF
Quick Verdict
VCSH has a lower expense ratio. XLK delivered stronger 1-year returns. VCSH offers more diversification with 3,023 holdings.
Side-by-Side Comparison
| Metric | VCSH | XLK | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.08% | |
| AUM | $52.0B | $124.4B | |
| Dividend Yield | 4.46% | 0.45% | |
| Holdings | 3,023 | 77 | |
| YTD Return | +1.10% | +27.34% | |
| 1Y Return | +3.32% | +42.34% | |
| 3Y Return (annualized) | +5.75% | +30.61% | |
| 5Y Return (annualized) | +2.38% | +19.29% | |
| Volatility (annualized) | 2.6% | 23.2% | |
| Max Drawdown | -12.9% | -82.0% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Fixed Income | Equity | |
| Inception | Nov 19, 2009 | Dec 16, 1998 |
VCSH vs XLK Performance
Vanguard Short Term Corporate Bond ETF (VCSH) is a ETF from Vanguard (US) and State Street Technology Select Sector SPDR ETF (XLK) is a ETF from SPDR State Street Global Advisors. Over the past year VCSH returned +3.32% while XLK returned +42.34%. Year to date, VCSH is up 1.10% versus a gain of 27.34% for XLK.
Over three years, VCSH compounded at +5.75% per year against +30.61% for XLK; over five years the annualized figures are +2.38% and +19.29% respectively. Across the full 17-year window we track, XLK has the edge at +9.37% annualized vs +1.30%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XLK has been the more volatile fund, with annualized monthly volatility of 23.2% compared with 2.6% for VCSH. 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 -12.9% for VCSH 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 0.43. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VCSH charges 0.03% per year while XLK charges 0.08%. On a $10,000 position that is $3 vs $8 annually, a gap of $5 per year that compounds over a long holding period. On income, VCSH currently yields 4.46% against 0.45% for XLK.
Holdings Overlap
VCSH and XLK share 0 holdings out of 632 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, VCSH or XLK?
VCSH has an expense ratio of 0.03% while XLK charges 0.08%. VCSH is the cheaper option. On a $10,000 investment, that is $5 per year of difference.
Which performed better, VCSH or XLK?
Over the past year VCSH returned +3.32% vs +42.34% for XLK, so XLK leads on 1-year performance. Over the longest common window we track (17 years), VCSH annualized +1.30% vs +9.37% for XLK. Past performance does not guarantee future results.
Which is riskier, VCSH or XLK?
XLK has been the more volatile fund at 23.2% annualized versus 2.6% for VCSH. Worst drawdown: VCSH -12.9% vs XLK -82.0%.
Should I hold both VCSH and XLK?
VCSH and XLK have a monthly-return correlation of 0.43, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VCSH and XLK?
VCSH and XLK share 0 common holdings with a 0.0% weight overlap. Combined, they hold 632 unique securities.
Which pays a higher dividend, VCSH or XLK?
VCSH yields 4.46% while XLK yields 0.45%, so VCSH currently pays the higher dividend yield.
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