XAR vs. PSCI

Last updated Jun 4, 2026

XAR (SPDR S&P Aerospace & Defense ETF) and PSCI (Invesco S&P SmallCap Industrials ETF) are both exchange-traded funds - XAR is a Aerospace & Defense fund tracking the S&P Aerospace & Defense Select Industry Index, while PSCI is a Industrials Equities fund tracking the S&P SmallCap 600 Industrials Index. Both are passively managed. Over the past 10 years, XAR returned 18.01%/yr vs 14.92%/yr for PSCI. A 0.74 correlation means they provide meaningful diversification when combined. XAR charges 0.35%/yr vs 0.29%/yr for PSCI.

Performance

XAR vs. PSCI - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in SPDR S&P Aerospace & Defense ETF (XAR) and Invesco S&P SmallCap Industrials ETF (PSCI). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

The year-to-date returns for both investments are quite close, with XAR having a 13.40% return and PSCI slightly higher at 13.72%. Over the past 10 years, XAR has outperformed PSCI with an annualized return of 18.01%, while PSCI has yielded a comparatively lower 14.92% annualized return.

XAR

• 1D: -2.08%
• 1M: 7.34%
• YTD: 13.40%
• 6M: 20.10%
• 1Y: 41.33%
• 3Y*: 34.11%
• 5Y*: 16.26%
• 10Y*: 18.01%

PSCI

• 1D: -0.49%
• 1M: 0.56%
• YTD: 13.72%
• 6M: 13.66%
• 1Y: 35.33%
• 3Y*: 21.37%
• 5Y*: 13.36%
• 10Y*: 14.92%

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

XAR vs. PSCI - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XAR SPDR S&P Aerospace & Defense ETF	13.40%	46.15%	23.32%	23.79%	-5.02%	2.31%	6.18%	39.33%	-4.58%	33.00%
PSCI Invesco S&P SmallCap Industrials ETF	13.72%	13.50%	16.68%	31.64%	-9.02%	24.44%	12.02%	29.80%	-13.20%	17.52%

Correlation

The correlation between XAR and PSCI is 0.66, 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	0.66
Correlation (3Y) Calculated over the trailing 3-year period	0.72
Correlation (5Y) Calculated over the trailing 5-year period	0.76
Correlation (10Y) Calculated over the trailing 10-year period	0.76
Correlation (All Time) Calculated using the full available price history since Sep 30, 2011	0.74

The correlation between XAR and PSCI shifts across timeframes, from 0.66 (1 year) to 0.76 (10 years), reflecting how their relationship changes across market environments.

XAR vs. PSCI - Sectors Allocation Comparison

Sectors	XAR	PSCI
Industrials	99.4%	82.9%
Technology	0.5%	7.1%
Basic Materials	-	0.9%
Communication Services	-	0.4%
Consumer Cyclical	-	5.4%
Consumer Defensive	-	-
Energy	-	2.1%
Financial Services	-	0.0%
Healthcare	-	0.5%
Real Estate	-	0.7%
Utilities	-	-

Return for Risk

XAR vs. PSCI — Risk / Return Rank

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

XAR

XAR Risk / Return Rank: 43
XAR Sharpe Ratio Rank: 43
XAR Sortino Ratio Rank: 43
XAR Omega Ratio Rank: 38
XAR Calmar Ratio Rank: 48
XAR Martin Ratio Rank: 42

PSCI

PSCI Risk / Return Rank: 48
PSCI Sharpe Ratio Rank: 48
PSCI Sortino Ratio Rank: 51
PSCI Omega Ratio Rank: 46
PSCI Calmar Ratio Rank: 48
PSCI Martin Ratio Rank: 49

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.

XAR vs. PSCI - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for SPDR S&P Aerospace & Defense ETF (XAR) and Invesco S&P SmallCap Industrials ETF (PSCI). 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.

	XAR	PSCI	Difference
Sharpe ratio: Return per unit of total volatility	1.55	1.69	-0.14
Sortino ratio: Return per unit of downside risk	2.21	2.49	-0.28
Omega ratio: Gain probability vs. loss probability	1.26	1.29	-0.04
Calmar ratio: Return relative to maximum drawdown	2.41	2.39	+0.03
Martin ratio: Return relative to average drawdown	6.85	8.11	-1.25
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

XAR vs. PSCI - Sharpe Ratio Comparison

The current XAR Sharpe Ratio is 1.55, which is comparable to the PSCI Sharpe Ratio of 1.69. The chart below compares the historical Sharpe Ratios of XAR and PSCI, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	XAR	PSCI	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.55	1.69	-0.14
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.70	0.58	+0.11
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.73	0.59	+0.14
Sharpe Ratio (All Time) Calculated using the full available price history	0.85	0.57	+0.28

Drawdowns

XAR vs. PSCI - Drawdown Comparison

The maximum XAR drawdown since its inception was -46.37%, roughly equal to the maximum PSCI drawdown of -45.55%. Use the drawdown chart below to compare losses from any high point for XAR and PSCI.

Drawdown Indicators

	XAR	PSCI	Difference
Max Drawdown Largest peak-to-trough decline	-46.37%	-45.55%	-0.82%
Max Drawdown (1Y) Largest decline over 1 year	-17.22%	-14.88%	-2.34%
Max Drawdown (3Y) Largest decline over 3 years	-19.73%	-29.36%	+9.63%
Max Drawdown (5Y) Largest decline over 5 years	-32.40%	-29.36%	-3.04%
Max Drawdown (10Y) Largest decline over 10 years	-46.37%	-45.55%	-0.82%
Current Drawdown Current decline from peak	-6.55%	-2.90%	-3.65%
Average Drawdown Average peak-to-trough decline	-6.79%	-6.91%	+0.12%
Ulcer Index Depth and duration of drawdowns from previous peaks	6.05%	4.37%	+1.68%

Volatility

XAR vs. PSCI - Volatility Comparison

SPDR S&P Aerospace & Defense ETF (XAR) has a higher volatility of 9.52% compared to Invesco S&P SmallCap Industrials ETF (PSCI) at 6.10%. This indicates that XAR's price experiences larger fluctuations and is considered to be riskier than PSCI based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XAR	PSCI	Difference
Volatility (1M) Calculated over the trailing 1-month period	9.52%	6.10%	+3.42%
Volatility (6M) Calculated over the trailing 6-month period	22.39%	15.45%	+6.94%
Volatility (1Y) Calculated over the trailing 1-year period	26.81%	21.05%	+5.76%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	23.41%	23.02%	+0.39%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.62%	25.25%	-0.63%

XAR vs. PSCI - Expense Ratio Comparison

XAR has a 0.35% expense ratio, which is higher than PSCI's 0.29% expense ratio.

Dividends

XAR vs. PSCI - Dividend Comparison

XAR's dividend yield for the trailing twelve months is around 0.32%, less than PSCI's 1.40% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
PSCI Invesco S&P SmallCap Industrials ETF	1.40%	1.56%	0.65%	0.72%	0.87%	0.69%	0.59%	0.64%	0.67%	0.71%	0.74%	1.02%
XAR SPDR S&P Aerospace & Defense ETF	0.32%	0.40%	0.66%	0.54%	0.50%	0.83%	0.63%	0.75%	1.19%	0.76%	1.09%	2.31%

Frequently Asked Questions

Can I hold both XAR and PSCI in my portfolio?

XAR and PSCI have a correlation of 0.66, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XAR or PSCI?

XAR has higher volatility (9.52%) compared to PSCI (6.10%). In terms of maximum drawdown, XAR dropped -46.37% vs PSCI's -45.55%.

Which ETF is better, XAR or PSCI?

On 10-year performance, XAR leads with 18.01% vs 14.92% for PSCI. On fees, PSCI is cheaper at 0.29% per year. On volatility, PSCI has been the lower-risk option at 6.10%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XAR or PSCI?

Over the 10-year period, XAR has performed better with a 18.01% return vs 14.92%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XAR or PSCI?

PSCI is cheaper with a 0.29% expense ratio, compared with 0.35% for XAR.

Which ETF pays a higher dividend yield, XAR or PSCI?

PSCI has the higher dividend yield at 1.40%, compared with 0.32% for XAR.

What is the main difference between XAR and PSCI?

XAR is categorized as Aerospace & Defense, while PSCI is Industrials Equities. XAR tracks S&P Aerospace & Defense Select Industry Index, while PSCI tracks S&P SmallCap 600 Industrials Index. They also come from different issuers: State Street and Invesco. Their fees differ too: 0.35% for XAR and 0.29% for PSCI.

Which has better risk-adjusted returns?

PSCI currently has the higher Sharpe Ratio (1.69 vs 1.55), 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.