VNQ vs XLK
Vanguard Real Estate ETF vs State Street Technology Select Sector SPDR ETF
Which is better, VNQ or XLK?
Mid Cap Blend against Large Cap Growth.
XLK has a lower expense ratio. XLK led over 1Y, 3Y, 5Y and the full window.
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 | VNQ | XLK |
|---|---|---|
| Expense Ratio | 0.13% | 0.08%Best |
| AUM | $35.9B | $109.6B |
| Dividend Yield | 3.63% | 0.47% |
| Holdings | 144 | 152 |
| YTD Return | +12.72% | +21.27%Best |
| 1Y Return | +10.42% | +19.62%Best |
| 3Y Return (annualized) | +13.36% | +25.85%Best |
| 5Y Return (annualized) | +1.44% | +16.97%Best |
| Volatility (annualized) | 21.4% | 18.9%Best |
| Max Drawdown | -75.8% | -53.6%Best |
| $10,000 over 5 years | $10,741 | $21,896Best |
| Fund Family | Vanguard (US) | State Street Investment Management |
| Category | Equity | Equity |
| Style | Mid Cap Blend | Large Cap Growth |
| Inception | Sep 23, 2004 | Dec 16, 1998 |
Not shown on this pair: Top 10 Weight.
Volatility and max drawdown are measured over the window both funds cover: Sep 29, 2004 to Nov 11, 2026 (22.1 years).
VNQ vs XLK 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 is available from the range buttons; it is not the opening view here because over the whole period one of these two funds moves so much further than the other that its line would sit flat on the axis.
VNQ vs XLK Performance
Vanguard Real Estate ETF (VNQ) is an ETF from Vanguard (US) and State Street Technology Select Sector SPDR ETF (XLK) is an ETF from State Street Investment Management. Over the past year VNQ returned +10.42% while XLK returned +19.62%. Year to date, VNQ is up 12.72% versus a gain of 21.27% for XLK.
Over three years, VNQ compounded at +13.36% per year against +25.85% for XLK; over five years the annualized figures are +1.44% and +16.97% respectively. Across the full 22-year window we track, XLK has the edge at +14.27% annualized vs +4.06%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VNQ has been the more volatile fund, with annualized monthly volatility of 21.4% compared with 18.9% for XLK. 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 -75.8% for VNQ and -53.6% for XLK. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.56. They move together some of the time, and apart the rest.
Fees and Cost Over Time
VNQ charges 0.13% per year while XLK charges 0.08%. On a $10,000 position that is $13 vs $8 annually, a gap of $5 per year that compounds over a long holding period. On income, VNQ currently yields 3.63% against 0.47% for XLK.
Holdings Overlap
We hold position weights for 139 holdings in VNQ and 74 in XLK, totalling 84.6% and 99.9% of the two funds. The two books name no position in common, so there is no overlap percentage to show.
0 positions in common, counted across the 139 positions we hold weights for in VNQ and 74 in XLK, against full books of 144 and 152.
You are not choosing between two funds in isolation.
Whichever of VNQ and XLK you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, VNQ or XLK?
VNQ has an expense ratio of 0.13% while XLK charges 0.08%. XLK is the cheaper option, by $5 a year on a $10,000 investment.
Which performed better, VNQ or XLK?
Over the past year VNQ returned +10.42% vs +19.62% for XLK, so XLK leads on 1-year performance. Over the longest common window we track (22 years), VNQ annualized +4.06% vs +14.27% for XLK. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, VNQ or XLK?
VNQ has been the more volatile fund at 21.4% annualized versus 18.9% for XLK. Worst drawdown: VNQ -75.8% vs XLK -53.6%.
Should I hold both VNQ and XLK?
VNQ and XLK have a monthly-return correlation of 0.56, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, VNQ or XLK?
VNQ yields 3.63% while XLK yields 0.47%, so VNQ currently pays the higher dividend yield.
Is XLK better than VNQ?
XLK has a lower expense ratio. XLK led over 1Y, 3Y, 5Y and the full window. Which one suits a particular account depends on what it is for. This is information, not a recommendation.