VO vs XLK
Vanguard Morningstar Mid-Cap ETF vs State Street Technology Select Sector SPDR ETF
Quick Verdict
VO has a lower expense ratio. XLK delivered stronger 1-year returns. VO offers more diversification with 289 holdings.
Side-by-Side Comparison
| Metric | VO | XLK | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.08% | |
| AUM | $106.6B | $124.4B | |
| Dividend Yield | 1.32% | 0.45% | |
| Holdings | 289 | 77 | |
| YTD Return | +14.20% | +27.34% | |
| 1Y Return | +18.01% | +42.34% | |
| 3Y Return (annualized) | +17.54% | +30.61% | |
| 5Y Return (annualized) | +8.07% | +19.29% | |
| Volatility (annualized) | 16.9% | 23.2% | |
| Max Drawdown | -60.3% | -82.0% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Jan 26, 2004 | Dec 16, 1998 |
VO vs XLK Performance
Vanguard Morningstar Mid-Cap ETF (VO) 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 VO returned +18.01% while XLK returned +42.34%. Year to date, VO is up 14.20% versus a gain of 27.34% for XLK.
Over three years, VO compounded at +17.54% per year against +30.61% for XLK; over five years the annualized figures are +8.07% and +19.29% respectively. Across the full 23-year window we track, XLK has the edge at +9.37% annualized vs +9.21%. 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 16.9% for VO. 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 -60.3% for VO 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 0.79. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VO 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, VO currently yields 1.32% against 0.45% for XLK.
Holdings Overlap
VO and XLK share 25 holdings out of 329 unique holdings combined, representing a 8.6% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VO or XLK?
VO has an expense ratio of 0.03% while XLK charges 0.08%. VO is the cheaper option. On a $10,000 investment, that is $5 per year of difference.
Which performed better, VO or XLK?
Over the past year VO returned +18.01% vs +42.34% for XLK, so XLK leads on 1-year performance. Over the longest common window we track (23 years), VO annualized +9.21% vs +9.37% for XLK. Past performance does not guarantee future results.
Which is riskier, VO or XLK?
XLK has been the more volatile fund at 23.2% annualized versus 16.9% for VO. Worst drawdown: VO -60.3% vs XLK -82.0%.
Should I hold both VO and XLK?
VO and XLK have a monthly-return correlation of 0.79, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VO and XLK?
VO and XLK share 25 common holdings with a 8.6% weight overlap. Combined, they hold 329 unique securities.
Which pays a higher dividend, VO or XLK?
VO yields 1.32% while XLK yields 0.45%, so VO currently pays the higher dividend yield.
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