VUG vs XLV
Vanguard Growth ETF vs State Street Health Care Select Sector SPDR ETF
Quick Verdict
VUG has a lower expense ratio. XLV delivered stronger 1-year returns. VUG offers more diversification with 146 holdings.
Side-by-Side Comparison
| Metric | VUG | XLV | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.08% | |
| AUM | $223.2B | $42.1B | |
| Dividend Yield | 0.47% | 1.60% | |
| Holdings | 155 | 62 | |
| YTD Return | +10.98% | +9.20% | |
| 1Y Return | +16.82% | +28.53% | |
| 3Y Return (annualized) | +24.53% | +9.18% | |
| 5Y Return (annualized) | +13.10% | +6.43% | |
| Volatility (annualized) | 16.5% | 14.2% | |
| Max Drawdown | -51.4% | -40.6% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Jan 26, 2004 | Dec 16, 1998 |
VUG vs XLV Performance
Vanguard Growth ETF (VUG) 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 VUG returned +16.82% while XLV returned +28.53%. Year to date, VUG is up 10.98% versus a gain of 9.20% for XLV.
Over three years, VUG compounded at +24.53% per year against +9.18% for XLV; over five years the annualized figures are +13.10% and +6.43% respectively. Across the full 23-year window we track, VUG has the edge at +11.31% annualized vs +7.48%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VUG has been the more volatile fund, with annualized monthly volatility of 16.5% compared with 14.2% for XLV. 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 -51.4% for VUG 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 0.64. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VUG 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, VUG currently yields 0.47% against 1.60% for XLV.
Holdings Overlap
VUG and XLV share 12 holdings out of 194 unique holdings combined, representing a 4.5% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VUG or XLV?
VUG has an expense ratio of 0.03% while XLV charges 0.08%. VUG is the cheaper option. On a $10,000 investment, that is $5 per year of difference.
Which performed better, VUG or XLV?
Over the past year VUG returned +16.82% vs +28.53% for XLV, so XLV leads on 1-year performance. Over the longest common window we track (23 years), VUG annualized +11.31% vs +7.48% for XLV. Past performance does not guarantee future results.
Which is riskier, VUG or XLV?
VUG has been the more volatile fund at 16.5% annualized versus 14.2% for XLV. Worst drawdown: VUG -51.4% vs XLV -40.6%.
Should I hold both VUG and XLV?
VUG and XLV have a monthly-return correlation of 0.64, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VUG and XLV?
VUG and XLV share 12 common holdings with a 4.5% weight overlap. Combined, they hold 194 unique securities.
Which pays a higher dividend, VUG or XLV?
VUG yields 0.47% while XLV yields 1.60%, so XLV currently pays the higher dividend yield.
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