VGT vs. XLK

Last updated Jul 3, 2026

VGT (Vanguard Information Technology ETF) and XLK (State Street Technology Select Sector SPDR ETF) are both Technology Equities funds - VGT tracks the MSCI USA IMI Information Technology 25/50 Index while XLK tracks the S&P Technology Select Sector Daily Capped 35/20 Index. Both are passively managed. Over the past 10 years, VGT returned 25.06%/yr vs 24.89%/yr for XLK. With a 0.96 correlation, they move nearly in lockstep. VGT charges 0.09%/yr vs 0.08%/yr for XLK.

Performance

VGT vs. XLK - Performance Comparison

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

Returns By Period

In the year-to-date period, VGT achieves a 21.94% return, which is significantly lower than XLK's 25.74% return. Both investments have delivered pretty close results over the past 10 years, with VGT having a 25.06% annualized return and XLK not far behind at 24.89%.

VGT

• 1D: -2.20%
• 1M: -8.74%
• 6M: 21.94%
• YTD: 21.94%
• 1Y: 38.57%
• 3Y*: 28.33%
• 5Y*: 18.62%
• 10Y*: 25.06%

XLK

• 1D: -2.71%
• 1M: -8.78%
• 6M: 25.74%
• YTD: 25.74%
• 1Y: 43.16%
• 3Y*: 28.53%
• 5Y*: 20.13%
• 10Y*: 24.89%

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

VGT vs. XLK - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VGT Vanguard Information Technology ETF	21.94%	21.77%	29.30%	52.66%	-29.70%	30.45%	46.04%	48.62%	2.46%	37.08%
XLK State Street Technology Select Sector SPDR ETF	25.74%	24.61%	21.63%	56.02%	-27.73%	34.74%	43.62%	49.86%	-1.68%	34.26%

Correlation

The correlation between VGT and XLK is 0.99 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.99
Correlation (3Y) Calculated over the trailing 3-year period	0.99
Correlation (5Y) Calculated over the trailing 5-year period	0.99
Correlation (10Y) Calculated over the trailing 10-year period	0.99
Correlation (All Time) Calculated using the full available price history since Jan 30, 2004	0.96

The correlation between VGT and XLK has been stable across timeframes, ranging from 0.96 to 0.99 - a consistent structural relationship.

VGT vs. XLK - Sectors Allocation Comparison

Sectors	VGT	XLK
Technology	98.5%	99.7%
Communication Services	0.6%	-
Financial Services	0.5%	-
Energy	0.3%	0.2%
Industrials	0.3%	0.1%
Consumer Cyclical	0.1%	-
Basic Materials	0.0%	-
Healthcare	0.0%	-
Consumer Defensive	-	-
Real Estate	-	-
Utilities	-	-

Return for Risk

VGT vs. XLK — Risk / Return Rank

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

VGT

VGT Risk / Return Rank: 54
VGT Sharpe Ratio Rank: 59
VGT Sortino Ratio Rank: 53
VGT Omega Ratio Rank: 53
VGT Calmar Ratio Rank: 57
VGT Martin Ratio Rank: 49

XLK

XLK Risk / Return Rank: 61
XLK Sharpe Ratio Rank: 66
XLK Sortino Ratio Rank: 57
XLK Omega Ratio Rank: 59
XLK Calmar Ratio Rank: 65
XLK Martin Ratio Rank: 57

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.

VGT vs. XLK - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Information Technology ETF (VGT) and State Street Technology Select Sector SPDR ETF (XLK). 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.

	VGT	XLK	Difference
Sharpe ratio: Return per unit of total volatility	1.68	1.81	-0.13
Sortino ratio: Return per unit of downside risk	2.20	2.32	-0.12
Omega ratio: Gain probability vs. loss probability	1.29	1.31	-0.02
Calmar ratio: Return relative to maximum drawdown	2.36	2.72	-0.36
Martin ratio: Return relative to average drawdown	7.02	8.46	-1.44

VGT vs. XLK - Sharpe Ratio Comparison

The current VGT Sharpe Ratio is 1.68, which is comparable to the XLK Sharpe Ratio of 1.81. The chart below compares the historical Sharpe Ratios of VGT and XLK, 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

VGT vs. XLK - Drawdown Comparison

The maximum VGT drawdown since its inception was -54.63%, smaller than the maximum XLK drawdown of -82.05%. Use the drawdown chart below to compare losses from any high point for VGT and XLK.

Drawdown Indicators

	VGT	XLK	Difference
Max Drawdown Largest peak-to-trough decline	-54.63%	-82.05%	+27.42%
Max Drawdown (1Y) Largest decline over 1 year	-16.40%	-15.92%	-0.48%
Max Drawdown (3Y) Largest decline over 3 years	-27.23%	-25.66%	-1.57%
Max Drawdown (5Y) Largest decline over 5 years	-35.07%	-33.56%	-1.51%
Max Drawdown (10Y) Largest decline over 10 years	-35.07%	-33.56%	-1.51%
Current Drawdown Current decline from peak	-8.74%	-8.78%	+0.04%
Average Drawdown Average peak-to-trough decline	-7.95%	-34.87%	+26.92%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.51%	5.12%	+0.39%

Volatility

VGT vs. XLK - Volatility Comparison

The current volatility for Vanguard Information Technology ETF (VGT) is 11.42%, while State Street Technology Select Sector SPDR ETF (XLK) has a volatility of 12.77%. This indicates that VGT experiences smaller price fluctuations and is considered to be less risky than XLK based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VGT	XLK	Difference
Volatility (1M) Calculated over the trailing 1-month period	11.42%	12.77%	-1.35%
Volatility (6M) Calculated over the trailing 6-month period	19.10%	20.41%	-1.31%
Volatility (1Y) Calculated over the trailing 1-year period	23.09%	24.04%	-0.95%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	25.63%	25.49%	+0.14%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.77%	24.75%	+0.02%

VGT vs. XLK - Expense Ratio Comparison

VGT has a 0.09% expense ratio, which is higher than XLK'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

VGT vs. XLK - Dividend Comparison

VGT's dividend yield for the trailing twelve months is around 0.38%, less than XLK's 0.44% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VGT Vanguard Information Technology ETF	0.38%	0.40%	0.60%	0.65%	0.91%	0.64%	0.82%	1.11%	1.29%	0.99%	1.31%	1.28%
XLK State Street Technology Select Sector SPDR ETF	0.44%	0.54%	0.66%	0.76%	1.04%	0.65%	0.92%	1.16%	1.60%	1.37%	1.74%	1.79%

Frequently Asked Questions

Can I hold both VGT and XLK in my portfolio?

With a correlation of 0.99, VGT and XLK move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, VGT or XLK?

XLK has higher volatility (12.77%) compared to VGT (11.42%). In terms of maximum drawdown, VGT dropped -54.63% vs XLK's -82.05%.

Which ETF is better, VGT or XLK?

On 10-year performance, VGT leads with 25.06% vs 24.89% for XLK. On fees, XLK is cheaper at 0.08% per year. On volatility, VGT has been the lower-risk option at 11.42%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VGT or XLK?

Over the 10-year period, VGT has performed better with a 25.06% return vs 24.89%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VGT or XLK?

XLK is cheaper with a 0.08% expense ratio, compared with 0.09% for VGT.

Which ETF pays a higher dividend yield, VGT or XLK?

XLK has the higher dividend yield at 0.44%, compared with 0.38% for VGT.

What is the main difference between VGT and XLK?

VGT tracks MSCI USA IMI Information Technology 25/50 Index, while XLK tracks S&P Technology Select Sector Daily Capped 35/20 Index. They also come from different issuers: Vanguard and State Street. Their fees differ too: 0.09% for VGT and 0.08% for XLK.

Which has better risk-adjusted returns?

XLK currently has the higher Sharpe Ratio (1.81 vs 1.68), 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.