SCHA vs. XLY

Last updated Jun 12, 2026

SCHA (Schwab U.S. Small-Cap ETF) and XLY (Consumer Discretionary Select Sector SPDR Fund) are both exchange-traded funds - SCHA is a Small Cap Blend Equities fund tracking the Dow Jones U.S. Small-Cap Total Stock Market Index, while XLY is a Consumer Discretionary Equities fund tracking the Consumer Discretionary Select Sector Index. Both are passively managed. Over the past 10 years, SCHA returned 11.39%/yr vs 12.72%/yr for XLY. A 0.79 correlation means they provide meaningful diversification when combined. SCHA charges 0.04%/yr vs 0.13%/yr for XLY.

Performance

SCHA vs. XLY - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Schwab U.S. Small-Cap ETF (SCHA) and Consumer Discretionary Select Sector SPDR Fund (XLY). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, SCHA achieves a 21.09% return, which is significantly higher than XLY's -2.41% return. Over the past 10 years, SCHA has underperformed XLY with an annualized return of 11.39%, while XLY has yielded a comparatively higher 12.72% annualized return.

SCHA

• 1D: 3.42%
• 1M: 4.11%
• YTD: 21.09%
• 6M: 16.82%
• 1Y: 39.46%
• 3Y*: 18.41%
• 5Y*: 6.95%
• 10Y*: 11.39%

XLY

• 1D: 2.48%
• 1M: -1.68%
• YTD: -2.41%
• 6M: -2.84%
• 1Y: 9.18%
• 3Y*: 13.28%
• 5Y*: 6.94%
• 10Y*: 12.72%

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

SCHA vs. XLY - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
SCHA Schwab U.S. Small-Cap ETF	21.09%	11.60%	11.16%	18.46%	-19.81%	16.45%	19.34%	26.50%	-11.79%	14.94%
XLY Consumer Discretionary Select Sector SPDR Fund	-2.41%	7.37%	26.51%	39.64%	-36.27%	27.93%	29.63%	28.39%	1.58%	22.82%

Correlation

The correlation between SCHA and XLY is 0.68, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.68
Correlation (3Y) Calculated over the trailing 3-year period	0.70
Correlation (5Y) Calculated over the trailing 5-year period	0.76
Correlation (10Y) Calculated over the trailing 10-year period	0.77
Correlation (All Time) Calculated using the full available price history since Nov 3, 2009	0.79

The correlation between SCHA and XLY shifts across timeframes, from 0.68 (1 year) to 0.79 (all time), reflecting how their relationship changes across market environments.

SCHA vs. XLY - Sectors Allocation Comparison

Sectors	SCHA	XLY
Technology	23.9%	0.9%
Industrials	15.6%	0.1%
Financial Services	15.3%	-
Healthcare	13.2%	-
Consumer Cyclical	9.0%	97.6%
Real Estate	5.9%	-
Energy	5.4%	-
Basic Materials	4.4%	-
Consumer Defensive	2.5%	-
Utilities	2.3%	-
Communication Services	2.3%	1.3%

Return for Risk

SCHA vs. XLY — Risk / Return Rank

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

SCHA

SCHA Risk / Return Rank: 82
SCHA Sharpe Ratio Rank: 80
SCHA Sortino Ratio Rank: 81
SCHA Omega Ratio Rank: 73
SCHA Calmar Ratio Rank: 87
SCHA Martin Ratio Rank: 87

XLY

XLY Risk / Return Rank: 19
XLY Sharpe Ratio Rank: 19
XLY Sortino Ratio Rank: 19
XLY Omega Ratio Rank: 18
XLY Calmar Ratio Rank: 19
XLY Martin Ratio Rank: 20

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.

SCHA vs. XLY - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Schwab U.S. Small-Cap ETF (SCHA) and Consumer Discretionary Select Sector SPDR Fund (XLY). 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.

	SCHA	XLY	Difference
Sharpe ratio: Return per unit of total volatility	2.13	0.50	+1.63
Sortino ratio: Return per unit of downside risk	2.98	0.83	+2.15
Omega ratio: Gain probability vs. loss probability	1.36	1.10	+0.26
Calmar ratio: Return relative to maximum drawdown	4.17	0.62	+3.56
Martin ratio: Return relative to average drawdown	15.27	1.89	+13.38

SCHA vs. XLY - Sharpe Ratio Comparison

The current SCHA Sharpe Ratio is 2.13, which is higher than the XLY Sharpe Ratio of 0.50. The chart below compares the historical Sharpe Ratios of SCHA and XLY, 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

SCHA vs. XLY - Drawdown Comparison

The maximum SCHA drawdown since its inception was -42.41%, smaller than the maximum XLY drawdown of -59.05%. Use the drawdown chart below to compare losses from any high point for SCHA and XLY.

Drawdown Indicators

	SCHA	XLY	Difference
Max Drawdown Largest peak-to-trough decline	-42.41%	-59.05%	+16.64%
Max Drawdown (1Y) Largest decline over 1 year	-9.50%	-14.98%	+5.48%
Max Drawdown (3Y) Largest decline over 3 years	-27.29%	-26.01%	-1.28%
Max Drawdown (5Y) Largest decline over 5 years	-30.79%	-39.67%	+8.88%
Max Drawdown (10Y) Largest decline over 10 years	-42.41%	-39.67%	-2.74%
Current Drawdown Current decline from peak	0.00%	-6.41%	+6.41%
Average Drawdown Average peak-to-trough decline	-7.57%	-9.55%	+1.98%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.59%	4.86%	-2.27%

Volatility

SCHA vs. XLY - Volatility Comparison

Schwab U.S. Small-Cap ETF (SCHA) has a higher volatility of 6.55% compared to Consumer Discretionary Select Sector SPDR Fund (XLY) at 6.20%. This indicates that SCHA's price experiences larger fluctuations and is considered to be riskier than XLY based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	SCHA	XLY	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.55%	6.20%	+0.35%
Volatility (6M) Calculated over the trailing 6-month period	13.72%	13.52%	+0.20%
Volatility (1Y) Calculated over the trailing 1-year period	18.60%	18.29%	+0.31%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.03%	23.84%	-1.81%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.75%	22.08%	+0.67%

SCHA vs. XLY - Expense Ratio Comparison

SCHA has a 0.04% expense ratio, which is lower than XLY's 0.13% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

SCHA vs. XLY - Dividend Comparison

SCHA's dividend yield for the trailing twelve months is around 0.99%, more than XLY's 0.77% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
SCHA Schwab U.S. Small-Cap ETF	0.99%	1.26%	1.51%	1.42%	1.37%	1.19%	1.05%	1.39%	1.58%	1.24%	1.50%	1.48%
XLY Consumer Discretionary Select Sector SPDR Fund	0.77%	0.79%	0.72%	0.78%	1.00%	0.53%	0.82%	1.28%	1.34%	1.20%	1.71%	1.43%

Frequently Asked Questions

Can I hold both SCHA and XLY in my portfolio?

SCHA and XLY have a correlation of 0.68, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, SCHA or XLY?

SCHA has higher volatility (6.55%) compared to XLY (6.20%). In terms of maximum drawdown, SCHA dropped -42.41% vs XLY's -59.05%.

Which ETF is better, SCHA or XLY?

On 10-year performance, XLY leads with 12.72% vs 11.39% for SCHA. On fees, SCHA is cheaper at 0.04% per year. On volatility, XLY has been the lower-risk option at 6.20%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, SCHA or XLY?

Over the 10-year period, XLY has performed better with a 12.72% return vs 11.39%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, SCHA or XLY?

SCHA is cheaper with a 0.04% expense ratio, compared with 0.13% for XLY.

Which ETF pays a higher dividend yield, SCHA or XLY?

SCHA has the higher dividend yield at 0.99%, compared with 0.77% for XLY.

What is the main difference between SCHA and XLY?

SCHA is categorized as Small Cap Blend Equities, while XLY is Consumer Discretionary Equities. SCHA tracks Dow Jones U.S. Small-Cap Total Stock Market Index, while XLY tracks Consumer Discretionary Select Sector Index. They also come from different issuers: Charles Schwab and State Street. Their fees differ too: 0.04% for SCHA and 0.13% for XLY.

Which has better risk-adjusted returns?

SCHA currently has the higher Sharpe Ratio (2.13 vs 0.50), 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.