VDE vs. XLP

Last updated Jul 26, 2026

VDE (Vanguard Energy ETF) and XLP (State Street Consumer Staples Select Sector SPDR ETF) are both exchange-traded funds - VDE is a Energy Equities fund tracking the MSCI US Investable Market Energy 25/50 Index, while XLP is a Consumer Staples Equities fund tracking the Consumer Staples Select Sector Index. Both are passively managed. Over the past 10 years, VDE returned 9.81%/yr vs 7.18%/yr for XLP. Their 0.36 correlation means their historical movements had little consistent relationship. VDE charges 0.09%/yr vs 0.08%/yr for XLP.

Performance

VDE vs. XLP - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Energy ETF (VDE) and State Street Consumer Staples Select Sector SPDR ETF (XLP). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VDE achieves a 35.27% return, which is significantly higher than XLP's 9.67% return. Over the past 10 years, VDE has outperformed XLP with an annualized return of 9.81%, while XLP has yielded a comparatively lower 7.18% annualized return.

VDE

• 1D: 0.04%
• 1M: 10.29%
• 6M: 22.82%
• YTD: 35.27%
• 1Y: 41.64%
• 3Y*: 15.31%
• 5Y*: 24.05%
• 10Y*: 9.81%
• ALL TIME*: 8.35%

XLP

• 1D: 1.11%
• 1M: 0.23%
• 6M: 2.75%
• YTD: 9.67%
• 1Y: 6.09%
• 3Y*: 6.34%
• 5Y*: 6.10%
• 10Y*: 7.18%
• ALL TIME*: 6.83%

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

Liquidity Comparison

Position	Avg. Volume Value (2W)	Avg. Volume Value (1M)	Avg. Volume Value (3M)
VDE Vanguard Energy ETF	$71.54M	$103.66M	$111.94M
XLP State Street Consumer Staples Select Sector SPDR ETF	$791.07M	$906.75M	$988.03M

VDE vs. XLP - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VDE Vanguard Energy ETF	35.27%	7.11%	6.75%	0.03%	62.89%	56.31%	-33.02%	9.28%	-19.95%	-2.50%
XLP State Street Consumer Staples Select Sector SPDR ETF	9.67%	1.52%	12.20%	-0.82%	-0.81%	17.20%	10.11%	27.43%	-8.07%	12.98%

Correlation

The correlation between VDE and XLP is 0.12, which is low. Their historical price movements had little consistent relationship.

	Correlation
Correlation (1Y) Focuses on recent behavior, but can change the most.	0.12
Correlation (3Y) Balances recent behavior with more history.	0.15
Correlation (5Y) Shows whether the relationship held over a longer period.	0.19
Correlation (10Y) Provides a long-term view across more market conditions.	0.24
Correlation (All Time) Calculated using the full available price history since Sep 29, 2004	0.36

Over the past year, the correlation between VDE and XLP has dropped to 0.12 - well below their long-term average of 0.36, suggesting their price drivers have been diverging.

VDE vs. XLP - Sectors Allocation Comparison

Sectors	VDE	XLP
Energy	77.0%	-
Basic Materials	0.4%	-
Industrials	0.2%	-
Utilities	0.1%	-
Communication Services	-	-
Consumer Cyclical	-	1.9%
Consumer Defensive	-	98.1%
Financial Services	-	-
Healthcare	-	-
Real Estate	-	-
Technology	-	-

Return for Risk

VDE vs. XLP — Risk / Return Rank

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

VDE

VDE Risk / Return Rank: 75
VDE Sharpe Ratio Rank: 85
VDE Sortino Ratio Rank: 79
VDE Omega Ratio Rank: 76
VDE Calmar Ratio Rank: 75
VDE Martin Ratio Rank: 61

XLP

XLP Risk / Return Rank: 22
XLP Sharpe Ratio Rank: 22
XLP Sortino Ratio Rank: 22
XLP Omega Ratio Rank: 20
XLP Calmar Ratio Rank: 23
XLP 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.

VDE vs. XLP - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Energy ETF (VDE) and State Street Consumer Staples Select Sector SPDR ETF (XLP). 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.

	VDE	XLP	Difference
Sharpe ratio: Return per unit of total volatility	1.98	0.45	+1.53
Sortino ratio: Return per unit of downside risk	2.57	0.76	+1.81
Omega ratio: Gain probability vs. loss probability	1.32	1.09	+0.24
Calmar ratio: Return relative to maximum drawdown	2.74	0.65	+2.09
Martin ratio: Return relative to average drawdown	7.34	1.18	+6.16

VDE vs. XLP - Sharpe Ratio Comparison

The current VDE Sharpe Ratio is 1.98, which is higher than the XLP Sharpe Ratio of 0.45. The chart below compares the historical Sharpe Ratios of VDE and XLP, 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

VDE vs. XLP - Drawdown Comparison

The maximum VDE drawdown since its inception was -74.20%, which is greater than XLP's maximum drawdown of -35.90%. Use the drawdown chart below to compare losses from any high point for VDE and XLP.

Drawdown Indicators

	VDE	XLP	Difference
Max Drawdown Largest peak-to-trough decline	-74.20%	-35.90%	-38.30%
Max Drawdown (1Y) Largest decline over 1 year	-15.04%	-9.69%	-5.35%
Max Drawdown (3Y) Largest decline over 3 years	-21.41%	-12.39%	-9.02%
Max Drawdown (5Y) Largest decline over 5 years	-26.58%	-16.30%	-10.28%
Max Drawdown (10Y) Largest decline over 10 years	-69.29%	-24.51%	-44.78%
Current Drawdown Current decline from peak	-4.29%	-5.35%	+1.06%
Average Drawdown Average peak-to-trough decline	-19.90%	-7.05%	-12.85%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.59%	5.31%	+0.28%

Volatility

VDE vs. XLP - Volatility Comparison

The current volatility for Vanguard Energy ETF (VDE) is 5.13%, while State Street Consumer Staples Select Sector SPDR ETF (XLP) has a volatility of 5.43%. This indicates that VDE experiences smaller price fluctuations and is considered to be less risky than XLP based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VDE	XLP	Difference
Volatility (1M) Calculated over the trailing 1-month period	5.13%	5.43%	-0.30%
Volatility (6M) Calculated over the trailing 6-month period	16.34%	11.20%	+5.14%
Volatility (1Y) Calculated over the trailing 1-year period	20.76%	13.85%	+6.91%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	26.14%	13.54%	+12.60%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	29.90%	14.83%	+15.07%

VDE vs. XLP - Expense Ratio Comparison

VDE has a 0.09% expense ratio, which is higher than XLP's 0.08% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VDE vs. XLP - Dividend Comparison

VDE's dividend yield for the trailing twelve months is around 2.39%, less than XLP's 2.61% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VDE Vanguard Energy ETF	2.39%	3.11%	3.23%	3.34%	3.65%	4.13%	4.76%	3.42%	3.35%	2.90%	2.31%	3.17%
XLP State Street Consumer Staples Select Sector SPDR ETF	2.61%	2.75%	2.77%	2.63%	2.47%	2.28%	2.50%	2.57%	3.04%	2.62%	2.53%	2.52%

Frequently Asked Questions

Can I hold both VDE and XLP in my portfolio?

VDE and XLP have a correlation of 0.12, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VDE or XLP?

XLP has higher volatility (5.43%) compared to VDE (5.13%). In terms of maximum drawdown, VDE dropped -74.20% vs XLP's -35.90%.

Which ETF is better, VDE or XLP?

On 10-year performance, VDE leads with 9.81% vs 7.18% for XLP. On fees, XLP is cheaper at 0.08% per year. On volatility, VDE has been the lower-risk option at 5.13%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VDE or XLP?

Over the 10-year period, VDE has performed better with a 9.81% return vs 7.18%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VDE or XLP?

XLP is cheaper with a 0.08% expense ratio, compared with 0.09% for VDE.

Which ETF pays a higher dividend yield, VDE or XLP?

XLP has the higher dividend yield at 2.61%, compared with 2.39% for VDE.

What is the main difference between VDE and XLP?

VDE is categorized as Energy Equities, while XLP is Consumer Staples Equities. VDE tracks MSCI US Investable Market Energy 25/50 Index, while XLP tracks Consumer Staples Select Sector Index. They also come from different issuers: Vanguard and State Street. Their fees differ too: 0.09% for VDE and 0.08% for XLP.

Which has better risk-adjusted returns?

VDE currently has the higher Sharpe Ratio (1.98 vs 0.45), 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.