XLE vs. VYM

Last updated Jun 14, 2026

XLE (State Street Energy Select Sector SPDR ETF) and VYM (Vanguard High Dividend Yield ETF) are both exchange-traded funds - XLE is a Energy Equities fund tracking the Energy Select Sector Index, while VYM is a Dividend fund tracking the FTSE High Dividend Yield Index. Both are passively managed. Over the past 10 years, XLE returned 9.91%/yr vs 11.95%/yr for VYM. A 0.66 correlation means they provide meaningful diversification when combined. XLE charges 0.08%/yr vs 0.04%/yr for VYM.

Performance

XLE vs. VYM - Performance Comparison

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

Returns By Period

In the year-to-date period, XLE achieves a 29.56% return, which is significantly higher than VYM's 12.37% return. Over the past 10 years, XLE has underperformed VYM with an annualized return of 9.91%, while VYM has yielded a comparatively higher 11.95% annualized return.

XLE

• 1D: 0.75%
• 1M: -0.90%
• YTD: 29.56%
• 6M: 28.37%
• 1Y: 34.84%
• 3Y*: 16.18%
• 5Y*: 20.12%
• 10Y*: 9.91%

VYM

• 1D: 0.80%
• 1M: 1.97%
• YTD: 12.37%
• 6M: 11.19%
• 1Y: 25.94%
• 3Y*: 18.06%
• 5Y*: 11.59%
• 10Y*: 11.95%

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

XLE vs. VYM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XLE State Street Energy Select Sector SPDR ETF	29.56%	7.88%	5.56%	-0.63%	64.32%	53.28%	-32.67%	11.74%	-18.22%	-0.89%
VYM Vanguard High Dividend Yield ETF	12.37%	15.42%	17.60%	6.57%	-0.43%	26.20%	1.15%	24.06%	-5.92%	16.42%

Correlation

The correlation between XLE and VYM is 0.22, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.22
Correlation (3Y) Calculated over the trailing 3-year period	0.46
Correlation (5Y) Calculated over the trailing 5-year period	0.54
Correlation (10Y) Calculated over the trailing 10-year period	0.62
Correlation (All Time) Calculated using the full available price history since Nov 16, 2006	0.66

Over the past year, the correlation between XLE and VYM has dropped to 0.22 - well below their long-term average of 0.66, suggesting their price drivers have been diverging.

XLE vs. VYM - Sectors Allocation Comparison

Sectors	XLE	VYM
Energy	100.0%	9.8%
Basic Materials	-	3.5%
Communication Services	-	3.5%
Consumer Cyclical	-	6.7%
Consumer Defensive	-	8.1%
Financial Services	-	20.5%
Healthcare	-	12.2%
Industrials	-	12.1%
Real Estate	-	0.0%
Technology	-	17.7%
Utilities	-	5.7%

Return for Risk

XLE vs. VYM — Risk / Return Rank

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

XLE

XLE Risk / Return Rank: 61
XLE Sharpe Ratio Rank: 64
XLE Sortino Ratio Rank: 58
XLE Omega Ratio Rank: 54
XLE Calmar Ratio Rank: 71
XLE Martin Ratio Rank: 56

VYM

VYM Risk / Return Rank: 83
VYM Sharpe Ratio Rank: 85
VYM Sortino Ratio Rank: 86
VYM Omega Ratio Rank: 83
VYM Calmar Ratio Rank: 81
VYM Martin Ratio Rank: 81

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.

XLE vs. VYM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for State Street Energy Select Sector SPDR ETF (XLE) and Vanguard High Dividend Yield ETF (VYM). 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.

	XLE	VYM	Difference
Sharpe ratio: Return per unit of total volatility	1.82	2.37	-0.55
Sortino ratio: Return per unit of downside risk	2.40	3.37	-0.97
Omega ratio: Gain probability vs. loss probability	1.30	1.42	-0.13
Calmar ratio: Return relative to maximum drawdown	3.10	3.70	-0.60
Martin ratio: Return relative to average drawdown	8.63	13.81	-5.18

XLE vs. VYM - Sharpe Ratio Comparison

The current XLE Sharpe Ratio is 1.82, which is comparable to the VYM Sharpe Ratio of 2.37. The chart below compares the historical Sharpe Ratios of XLE and VYM, 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

XLE vs. VYM - Drawdown Comparison

The maximum XLE drawdown since its inception was -71.26%, which is greater than VYM's maximum drawdown of -56.98%. Use the drawdown chart below to compare losses from any high point for XLE and VYM.

Drawdown Indicators

	XLE	VYM	Difference
Max Drawdown Largest peak-to-trough decline	-71.26%	-56.98%	-14.28%
Max Drawdown (1Y) Largest decline over 1 year	-12.05%	-6.69%	-5.36%
Max Drawdown (3Y) Largest decline over 3 years	-20.14%	-14.46%	-5.68%
Max Drawdown (5Y) Largest decline over 5 years	-26.04%	-15.84%	-10.20%
Max Drawdown (10Y) Largest decline over 10 years	-66.81%	-35.21%	-31.60%
Current Drawdown Current decline from peak	-8.01%	-0.52%	-7.49%
Average Drawdown Average peak-to-trough decline	-17.97%	-7.18%	-10.79%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.32%	1.80%	+2.52%

Volatility

XLE vs. VYM - Volatility Comparison

State Street Energy Select Sector SPDR ETF (XLE) has a higher volatility of 7.26% compared to Vanguard High Dividend Yield ETF (VYM) at 3.31%. This indicates that XLE's price experiences larger fluctuations and is considered to be riskier than VYM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XLE	VYM	Difference
Volatility (1M) Calculated over the trailing 1-month period	7.26%	3.31%	+3.95%
Volatility (6M) Calculated over the trailing 6-month period	16.79%	7.81%	+8.98%
Volatility (1Y) Calculated over the trailing 1-year period	20.57%	10.47%	+10.10%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	26.05%	13.99%	+12.06%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	29.58%	16.35%	+13.23%

XLE vs. VYM - Expense Ratio Comparison

XLE has a 0.08% expense ratio, which is higher than VYM's 0.04% 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

XLE vs. VYM - Dividend Comparison

XLE's dividend yield for the trailing twelve months is around 2.59%, more than VYM's 2.19% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VYM Vanguard High Dividend Yield ETF	2.19%	2.44%	2.74%	3.12%	3.01%	2.76%	3.18%	3.03%	3.40%	2.80%	2.91%	3.22%
XLE State Street Energy Select Sector SPDR ETF	2.59%	3.28%	3.36%	3.55%	3.68%	4.21%	5.62%	6.72%	3.54%	3.03%	2.26%	3.39%

Frequently Asked Questions

Can I hold both XLE and VYM in my portfolio?

XLE and VYM have a correlation of 0.22, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XLE or VYM?

XLE has higher volatility (7.26%) compared to VYM (3.31%). In terms of maximum drawdown, XLE dropped -71.26% vs VYM's -56.98%.

Which ETF is better, XLE or VYM?

On 10-year performance, VYM leads with 11.95% vs 9.91% for XLE. On fees, VYM is cheaper at 0.04% per year. On volatility, VYM has been the lower-risk option at 3.31%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XLE or VYM?

Over the 10-year period, VYM has performed better with a 11.95% return vs 9.91%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XLE or VYM?

VYM is cheaper with a 0.04% expense ratio, compared with 0.08% for XLE.

Which ETF pays a higher dividend yield, XLE or VYM?

XLE has the higher dividend yield at 2.59%, compared with 2.19% for VYM.

What is the main difference between XLE and VYM?

XLE is categorized as Energy Equities, while VYM is Dividend. XLE tracks Energy Select Sector Index, while VYM tracks FTSE High Dividend Yield Index. They also come from different issuers: State Street and Vanguard. Their fees differ too: 0.08% for XLE and 0.04% for VYM.

Which has better risk-adjusted returns?

VYM currently has the higher Sharpe Ratio (2.37 vs 1.82), 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.