VGK vs XLK
Vanguard FTSE Europe ETF vs State Street Technology Select Sector SPDR ETF
Quick Verdict
VGK has a lower expense ratio. XLK delivered stronger 1-year returns. VGK offers more diversification with 1,251 holdings.
Side-by-Side Comparison
| Metric | VGK | XLK | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.08% | |
| AUM | $30.5B | $124.4B | |
| Dividend Yield | 2.82% | 0.45% | |
| Holdings | 1,251 | 77 | |
| YTD Return | +11.66% | +27.34% | |
| 1Y Return | +21.09% | +42.34% | |
| 3Y Return (annualized) | +19.39% | +30.61% | |
| 5Y Return (annualized) | +9.54% | +19.29% | |
| Volatility (annualized) | 18.5% | 23.2% | |
| Max Drawdown | -67.3% | -82.0% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Mar 4, 2005 | Dec 16, 1998 |
VGK vs XLK Performance
Vanguard FTSE Europe ETF (VGK) 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 VGK returned +21.09% while XLK returned +42.34%. Year to date, VGK is up 11.66% versus a gain of 27.34% for XLK.
Over three years, VGK compounded at +19.39% per year against +30.61% for XLK; over five years the annualized figures are +9.54% and +19.29% respectively. Across the full 21-year window we track, XLK has the edge at +9.37% annualized vs +3.71%. 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 18.5% for VGK. 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 -67.3% for VGK 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 0.70. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VGK charges 0.06% per year while XLK charges 0.08%. On a $10,000 position that is $6 vs $8 annually, a gap of $2 per year that compounds over a long holding period. On income, VGK currently yields 2.82% against 0.45% for XLK.
Holdings Overlap
VGK and XLK share 1 holdings out of 1251 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in VGK | Weight in XLK | Difference |
|---|---|---|---|
| GEN | 0.01% | 0.10% | 0.09% |
Frequently Asked Questions
Which is cheaper, VGK or XLK?
VGK has an expense ratio of 0.06% while XLK charges 0.08%. VGK is the cheaper option. On a $10,000 investment, that is $2 per year of difference.
Which performed better, VGK or XLK?
Over the past year VGK returned +21.09% vs +42.34% for XLK, so XLK leads on 1-year performance. Over the longest common window we track (21 years), VGK annualized +3.71% vs +9.37% for XLK. Past performance does not guarantee future results.
Which is riskier, VGK or XLK?
XLK has been the more volatile fund at 23.2% annualized versus 18.5% for VGK. Worst drawdown: VGK -67.3% vs XLK -82.0%.
Should I hold both VGK and XLK?
VGK and XLK have a monthly-return correlation of 0.70, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VGK and XLK?
VGK and XLK share 1 common holdings with a 0.0% weight overlap. Combined, they hold 1251 unique securities.
Which pays a higher dividend, VGK or XLK?
VGK yields 2.82% while XLK yields 0.45%, so VGK currently pays the higher dividend yield.
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