VDIGX vs XLF
Vanguard Dividend Growth Fund Investor Class vs State Street Financial Select Sector SPDR ETF
Which is better, VDIGX or XLF?
Large Cap Blend against Large Cap Value.
XLF has a lower expense ratio. XLF led over 1Y, 3Y, 5Y and the full window. VDIGX is less concentrated, with 38.2% of the fund in its ten largest positions against 57.3%.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | VDIGX | XLF |
|---|---|---|
| Expense Ratio | 0.20% | 0.08%Best |
| AUM | $35.5B | $51.9B |
| Dividend Yield | 23.10% | 1.40% |
| Holdings | 60 | 160 |
| YTD Price Return | -1.46% | -0.20%Best |
| 1Y Price Return | -11.55% | +4.10%Best |
| 3Y Price Return (annualized) | -1.91% | +17.82%Best |
| 5Y Price Return (annualized) | -3.14% | +7.44%Best |
| Volatility (annualized) | 15.8%Best | 18.1% |
| Max Drawdown | -32.6% | -26.9%Best |
| $10,000 over 5 years | $8,526 | $14,316Best |
| Top 10 Weight | 38.2%Best | 57.3% |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors |
| Category | Equity | Equity |
| Style | Large Cap Blend | Large Cap Value |
| Inception | May 15, 1992 | Dec 16, 1998 |
Returns are price returns and exclude distributions, because our data feed carries no adjusted close for VDIGX. Both funds are measured the same way, so the comparison holds. VDIGX yields 23.10% and XLF 1.40% on top.
Volatility and max drawdown are measured over the window both funds cover: Oct 14, 2021 to Oct 12, 2026 (5 years).
VDIGX vs XLF growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view covers the 5 years both funds cover. Prices exclude distributions, on both funds alike.
VDIGX vs XLF Performance
Vanguard Dividend Growth Fund Investor Class (VDIGX) is a mutual fund from Vanguard (US) and State Street Financial Select Sector SPDR ETF (XLF) is an ETF from SPDR State Street Global Advisors. Over the past year VDIGX returned -11.55% while XLF returned +4.10%. Year to date, VDIGX is down 1.46% versus a loss of 0.20% for XLF.
Over three years, VDIGX compounded at -1.91% per year against +17.82% for XLF; over five years the annualized figures are -3.14% and +7.44% respectively.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XLF has been the more volatile fund, with annualized monthly volatility of 18.1% compared with 15.8% for VDIGX. 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 -32.6% for VDIGX and -26.9% for XLF. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.65. They move together some of the time, and apart the rest.
Fees and Cost Over Time
VDIGX charges 0.20% per year while XLF charges 0.08%. On a $10,000 position that is $20 vs $8 annually, a gap of $12 per year that compounds over a long holding period. On income, VDIGX currently yields 23.10% against 1.40% for XLF.
Structure and taxes
VDIGX is a mutual fund and XLF is an ETF. A mutual fund prices once a day at net asset value and may carry a purchase minimum. An ETF trades through the day at whatever the market pays for it.
In a taxable account the difference that usually matters is distributions. An ETF can meet redemptions in kind, so it rarely has to sell holdings and rarely passes a capital gain to the people who held it; a mutual fund that sells holdings to meet redemptions can distribute a realised gain at year end to everyone still in the fund, whether or not they sold anything themselves. In a tax-deferred account that difference largely disappears. Both are descriptions of how the two wrappers work, not a recommendation.
Tax-loss harvesting works on either wrapper.
Holdings Overlap
19.8% of VDIGX's money is in holdings XLF also owns. 24.9% of XLF's money is in holdings VDIGX also owns.
XLF and VDIGX share little of their money.
The two holdings books were reported 73 days apart, VDIGX as of Jun 30, 2026 and XLF as of Sep 11, 2026, so some of the difference between them is the time between the two reports rather than the funds.
8 positions in common, counted across the 51 positions we hold weights for in VDIGX and 77 in XLF, against full books of 60 and 160.
What only one of them owns
Our book lists 68 positions for XLF that do not appear in our book for VDIGX (74.6% of the fund), and 41 for VDIGX that do not appear in XLF (77.3%).
Some of those will be the same company recorded under a different code in one of the two books, so the real difference in what you would own is no larger than this and may be smaller. We do not name the individual positions here for that reason.
Top Shared Holdings
| Stock | Weight in VDIGX | Weight in XLF | Difference |
|---|---|---|---|
| VVisa Inc Class A | 3.23% | 7.62% | 4.39% |
| MAMastercard Inc | 3.56% | 5.69% | 2.13% |
| WFCWells Fargo & Co. | 2.68% | 3.42% | 0.74% |
| BLKBlackrock Funding Inc/De | 2.62% | 1.93% | 0.69% |
| AXPAmerican Express Co. | 1.80% | 2.14% | 0.34% |
| CBChubb Ltd. | 2.03% | 1.51% | 0.52% |
| MMCMarsh & Mclennan Cos Inc Common Stock Usd 1 | 2.25% | 1.06% | 1.19% |
| SPGIS&p Global Inc. | 1.66% | 1.54% | 0.12% |
24.9% of XLF is already inside VDIGX.
You probably hold more than these two. Add the rest and see how much of the whole book is the same companies twice.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, VDIGX or XLF?
VDIGX has an expense ratio of 0.20% while XLF charges 0.08%. XLF is the cheaper option, by $12 a year on a $10,000 investment.
Which performed better, VDIGX or XLF?
Over the past year VDIGX returned -11.55% vs +4.10% for XLF, so XLF leads on 1-year performance. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, VDIGX or XLF?
XLF has been the more volatile fund at 18.1% annualized versus 15.8% for VDIGX. Worst drawdown: VDIGX -32.6% vs XLF -26.9%.
Should I hold both VDIGX and XLF?
VDIGX and XLF have a monthly-return correlation of 0.65, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
What is the holdings overlap between VDIGX and XLF?
24.9% of XLF's money is in holdings VDIGX also owns. 24.9% of XLF's is in holdings VDIGX also owns. They hold 8 positions in common, counted across the 51 positions we hold weights for in VDIGX and 77 in XLF.
Which pays a higher dividend, VDIGX or XLF?
VDIGX yields 23.10% while XLF yields 1.40%, so VDIGX currently pays the higher dividend yield.
Is it better to hold VDIGX or XLF in a taxable account?
XLF is an ETF and VDIGX is a mutual fund. An ETF can meet redemptions in kind, so it rarely distributes a capital gain to the people holding it. A mutual fund that sells holdings to meet redemptions can pass a realised gain to every holder at year end. In a tax-deferred account that difference largely disappears. This is information, not a recommendation.
Is XLF better than VDIGX?
XLF has a lower expense ratio. XLF led over 1Y, 3Y, 5Y and the full window. VDIGX is less concentrated, with 38.2% of the fund in its ten largest positions against 57.3%. Which one suits a particular account depends on what it is for. This is information, not a recommendation.