VYM vs XLV
Vanguard High Dividend Yield ETF vs State Street Health Care Select Sector SPDR ETF
Quick Verdict
VYM has a lower expense ratio. XLV delivered stronger 1-year returns. VYM offers more diversification with 613 holdings.
Side-by-Side Comparison
| Metric | VYM | XLV | Winner |
|---|---|---|---|
| Expense Ratio | 0.04% | 0.08% | |
| AUM | $81.6B | $44.2B | |
| Dividend Yield | 2.24% | 1.56% | |
| Holdings | 613 | 63 | |
| YTD Return | +14.18% | +11.33% | |
| 1Y Return | +20.67% | +26.98% | |
| 3Y Return (annualized) | +18.47% | +10.98% | |
| 5Y Return (annualized) | +12.01% | +6.60% | |
| Volatility (annualized) | 14.5% | 14.2% | |
| Max Drawdown | -58.8% | -40.6% | |
| Fund Family | Vanguard (US) | SPDR State Street Global Advisors | |
| Category | Equity | Equity | |
| Inception | Nov 10, 2006 | Dec 16, 1998 |
VYM vs XLV Performance
Vanguard High Dividend Yield ETF (VYM) 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 VYM returned +20.67% while XLV returned +26.98%. Year to date, VYM is up 14.18% versus a gain of 11.33% for XLV.
Over three years, VYM compounded at +18.47% per year against +10.98% for XLV; over five years the annualized figures are +12.01% and +6.60% respectively. Across the full 20-year window we track, XLV has the edge at +7.54% annualized vs +6.97%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.5% 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 -58.8% for VYM 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 0.76. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VYM charges 0.04% per year while XLV charges 0.08%. On a $10,000 position that is $4 vs $8 annually, a gap of $4 per year that compounds over a long holding period. On income, VYM currently yields 2.24% against 1.56% for XLV.
Holdings Overlap
VYM and XLV share 18 holdings out of 646 unique holdings combined, representing a 12.6% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VYM or XLV?
VYM has an expense ratio of 0.04% while XLV charges 0.08%. VYM is the cheaper option. On a $10,000 investment, that is $4 per year of difference.
Which performed better, VYM or XLV?
Over the past year VYM returned +20.67% vs +26.98% for XLV, so XLV leads on 1-year performance. Over the longest common window we track (20 years), VYM annualized +6.97% vs +7.54% for XLV. Past performance does not guarantee future results.
Which is riskier, VYM or XLV?
VYM has been the more volatile fund at 14.5% annualized versus 14.2% for XLV. Worst drawdown: VYM -58.8% vs XLV -40.6%.
Should I hold both VYM and XLV?
VYM and XLV have a monthly-return correlation of 0.76, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VYM and XLV?
VYM and XLV share 18 common holdings with a 12.6% weight overlap. Combined, they hold 646 unique securities.
Which pays a higher dividend, VYM or XLV?
VYM yields 2.24% while XLV yields 1.56%, so VYM currently pays the higher dividend yield.
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