VGSH vs XLV
Vanguard Short Term Treasury ETF vs State Street Health Care Select Sector SPDR ETF
Quick Verdict
VGSH has a lower expense ratio. XLV delivered stronger 1-year returns. VGSH offers more diversification with 94 holdings.
Side-by-Side Comparison
| Metric | VGSH | XLV | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.08% | |
| AUM | $34.7B | $43.9B | |
| Dividend Yield | 3.85% | 1.56% | |
| Holdings | 94 | 63 | |
| YTD Return | +1.13% | +8.55% | |
| 1Y Return | +2.95% | +27.12% | |
| 3Y Return (annualized) | +4.38% | +9.09% | |
| 5Y Return (annualized) | +1.95% | +6.07% | |
| Volatility (annualized) | 1.4% | 14.2% | |
| Max Drawdown | -6.7% | -40.6% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Fixed Income | Equity | |
| Inception | Nov 19, 2009 | Dec 16, 1998 |
VGSH vs XLV Performance
Vanguard Short Term Treasury ETF (VGSH) 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 VGSH returned +2.95% while XLV returned +27.12%. Year to date, VGSH is up 1.13% versus a gain of 8.55% for XLV.
Over three years, VGSH compounded at +4.38% per year against +9.09% for XLV; over five years the annualized figures are +1.95% and +6.07% respectively. Across the full 17-year window we track, XLV has the edge at +7.46% annualized vs +0.73%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
XLV has been the more volatile fund, with annualized monthly volatility of 14.2% compared with 1.4% for VGSH. 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 -6.7% for VGSH 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 0.07. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VGSH charges 0.03% per year while XLV 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, VGSH currently yields 3.85% against 1.56% for XLV.
Holdings Overlap
VGSH and XLV share 0 holdings out of 76 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, VGSH or XLV?
VGSH has an expense ratio of 0.03% while XLV charges 0.08%. VGSH is the cheaper option. On a $10,000 investment, that is $5 per year of difference.
Which performed better, VGSH or XLV?
Over the past year VGSH returned +2.95% vs +27.12% for XLV, so XLV leads on 1-year performance. Over the longest common window we track (17 years), VGSH annualized +0.73% vs +7.46% for XLV. Past performance does not guarantee future results.
Which is riskier, VGSH or XLV?
XLV has been the more volatile fund at 14.2% annualized versus 1.4% for VGSH. Worst drawdown: VGSH -6.7% vs XLV -40.6%.
Should I hold both VGSH and XLV?
VGSH and XLV have a monthly-return correlation of 0.07, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VGSH and XLV?
VGSH and XLV share 0 common holdings with a 0.0% weight overlap. Combined, they hold 76 unique securities.
Which pays a higher dividend, VGSH or XLV?
VGSH yields 3.85% while XLV yields 1.56%, so VGSH currently pays the higher dividend yield.
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