KBWB vs. XLF

Last updated Jun 23, 2026

KBWB (Invesco KBW Bank ETF) and XLF (State Street Financial Select Sector SPDR ETF) are both Financials Equities funds - KBWB tracks the KBW Nasdaq Bank Index while XLF tracks the Financial Select Sector Index. Both are passively managed. Over the past 10 years, KBWB returned 13.99%/yr vs 13.68%/yr for XLF. Their correlation of 0.93 suggests significant overlap in exposure. KBWB charges 0.35%/yr vs 0.08%/yr for XLF.

Performance

KBWB vs. XLF - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Invesco KBW Bank ETF (KBWB) and State Street Financial Select Sector SPDR ETF (XLF). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, KBWB achieves a 12.18% return, which is significantly higher than XLF's -1.10% return. Both investments have delivered pretty close results over the past 10 years, with KBWB having a 13.99% annualized return and XLF not far behind at 13.68%.

KBWB

• 1D: 1.42%
• 1M: 8.59%
• YTD: 12.18%
• 6M: 10.15%
• 1Y: 41.92%
• 3Y*: 36.76%
• 5Y*: 11.16%
• 10Y*: 13.99%

XLF

• 1D: 0.59%
• 1M: 3.75%
• YTD: -1.10%
• 6M: -2.09%
• 1Y: 8.66%
• 3Y*: 19.81%
• 5Y*: 10.20%
• 10Y*: 13.68%

*Multi-year figures are annualized to reflect compound growth (CAGR)

KBWB vs. XLF - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
KBWB Invesco KBW Bank ETF	12.18%	32.05%	36.73%	-1.18%	-21.68%	37.72%	-10.46%	35.90%	-18.30%	18.11%
XLF State Street Financial Select Sector SPDR ETF	-1.10%	14.90%	30.56%	12.03%	-10.59%	34.80%	-1.74%	31.88%	-13.06%	22.00%

Correlation

The correlation between KBWB and XLF is 0.86, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.86
Correlation (3Y) Calculated over the trailing 3-year period	0.86
Correlation (5Y) Calculated over the trailing 5-year period	0.91
Correlation (10Y) Calculated over the trailing 10-year period	0.93
Correlation (All Time) Calculated using the full available price history since Nov 1, 2011	0.93

The correlation between KBWB and XLF has been stable across timeframes, ranging from 0.86 to 0.93 - a consistent structural relationship.

KBWB vs. XLF - Sectors Allocation Comparison

Sectors	KBWB	XLF
Financial Services	100.0%	98.0%
Basic Materials	-	-
Communication Services	-	-
Consumer Cyclical	-	-
Consumer Defensive	-	-
Energy	-	-
Healthcare	-	-
Industrials	-	0.2%
Real Estate	-	-
Technology	-	1.8%
Utilities	-	-

Return for Risk

KBWB vs. XLF — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

KBWB

KBWB Risk / Return Rank: 58
KBWB Sharpe Ratio Rank: 66
KBWB Sortino Ratio Rank: 59
KBWB Omega Ratio Rank: 61
KBWB Calmar Ratio Rank: 53
KBWB Martin Ratio Rank: 49

XLF

XLF Risk / Return Rank: 16
XLF Sharpe Ratio Rank: 18
XLF Sortino Ratio Rank: 16
XLF Omega Ratio Rank: 16
XLF Calmar Ratio Rank: 15
XLF Martin Ratio Rank: 15

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

KBWB vs. XLF - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Invesco KBW Bank ETF (KBWB) and State Street Financial Select Sector SPDR ETF (XLF). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	KBWB	XLF	Difference
Sharpe ratio: Return per unit of total volatility	2.08	0.60	+1.48
Sortino ratio: Return per unit of downside risk	2.69	0.89	+1.80
Omega ratio: Gain probability vs. loss probability	1.36	1.11	+0.25
Calmar ratio: Return relative to maximum drawdown	2.57	0.59	+1.98
Martin ratio: Return relative to average drawdown	8.09	1.50	+6.59

KBWB vs. XLF - Sharpe Ratio Comparison

The current KBWB Sharpe Ratio is 2.08, which is higher than the XLF Sharpe Ratio of 0.60. The chart below compares the historical Sharpe Ratios of KBWB and XLF, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

KBWB vs. XLF - Drawdown Comparison

The maximum KBWB drawdown since its inception was -50.27%, smaller than the maximum XLF drawdown of -82.69%. Use the drawdown chart below to compare losses from any high point for KBWB and XLF.

Drawdown Indicators

	KBWB	XLF	Difference
Max Drawdown Largest peak-to-trough decline	-50.27%	-82.69%	+32.42%
Max Drawdown (1Y) Largest decline over 1 year	-16.38%	-14.79%	-1.59%
Max Drawdown (3Y) Largest decline over 3 years	-25.43%	-15.54%	-9.89%
Max Drawdown (5Y) Largest decline over 5 years	-49.31%	-25.81%	-23.50%
Max Drawdown (10Y) Largest decline over 10 years	-50.27%	-42.86%	-7.41%
Current Drawdown Current decline from peak	0.00%	-3.96%	+3.96%
Average Drawdown Average peak-to-trough decline	-11.70%	-20.00%	+8.30%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.20%	5.78%	-0.58%

Volatility

KBWB vs. XLF - Volatility Comparison

Invesco KBW Bank ETF (KBWB) has a higher volatility of 5.65% compared to State Street Financial Select Sector SPDR ETF (XLF) at 4.12%. This indicates that KBWB's price experiences larger fluctuations and is considered to be riskier than XLF based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	KBWB	XLF	Difference
Volatility (1M) Calculated over the trailing 1-month period	5.65%	4.12%	+1.53%
Volatility (6M) Calculated over the trailing 6-month period	15.88%	11.27%	+4.61%
Volatility (1Y) Calculated over the trailing 1-year period	20.30%	14.64%	+5.66%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	26.55%	18.58%	+7.97%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	29.21%	22.18%	+7.03%

KBWB vs. XLF - Expense Ratio Comparison

KBWB has a 0.35% expense ratio, which is higher than XLF's 0.08% expense ratio.

Dividends

KBWB vs. XLF - Dividend Comparison

KBWB's dividend yield for the trailing twelve months is around 2.43%, more than XLF's 1.82% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
KBWB Invesco KBW Bank ETF	2.43%	2.04%	2.46%	3.20%	3.05%	2.13%	2.62%	2.38%	2.54%	1.35%	1.53%	1.53%
XLF State Street Financial Select Sector SPDR ETF	1.82%	1.31%	1.42%	1.71%	2.04%	1.63%	2.03%	1.87%	2.08%	1.48%	21.10%	1.95%

Frequently Asked Questions

Can I hold both KBWB and XLF in my portfolio?

KBWB and XLF have a correlation of 0.86, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, KBWB or XLF?

KBWB has higher volatility (5.65%) compared to XLF (4.12%). In terms of maximum drawdown, KBWB dropped -50.27% vs XLF's -82.69%.

Which ETF is better, KBWB or XLF?

On 10-year performance, KBWB leads with 13.99% vs 13.68% for XLF. On fees, XLF is cheaper at 0.08% per year. On volatility, XLF has been the lower-risk option at 4.12%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, KBWB or XLF?

Over the 10-year period, KBWB has performed better with a 13.99% return vs 13.68%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, KBWB or XLF?

XLF is cheaper with a 0.08% expense ratio, compared with 0.35% for KBWB.

Which ETF pays a higher dividend yield, KBWB or XLF?

KBWB has the higher dividend yield at 2.43%, compared with 1.82% for XLF.

What is the main difference between KBWB and XLF?

KBWB tracks KBW Nasdaq Bank Index, while XLF tracks Financial Select Sector Index. They also come from different issuers: Invesco and State Street. Their fees differ too: 0.35% for KBWB and 0.08% for XLF.

Which has better risk-adjusted returns?

KBWB currently has the higher Sharpe Ratio (2.08 vs 0.59), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.