XLK vs. CAT

Last updated Jun 14, 2026

XLK (State Street Technology Select Sector SPDR ETF) is Technology Equities fund tracking the S&P Technology Select Sector Daily Capped 35/20 Index, while CAT (Caterpillar Inc.) is a stock. Over the past 10 years, XLK returned 25.19%/yr vs 31.33%/yr for CAT. At a 0.48 correlation, their price movements are largely independent.

Performance

XLK vs. CAT - Performance Comparison

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

Returns By Period

In the year-to-date period, XLK achieves a 28.52% return, which is significantly lower than CAT's 59.62% return. Over the past 10 years, XLK has underperformed CAT with an annualized return of 25.19%, while CAT has yielded a comparatively higher 31.33% annualized return.

XLK

• 1D: 0.87%
• 1M: 2.95%
• YTD: 28.52%
• 6M: 28.96%
• 1Y: 55.42%
• 3Y*: 30.28%
• 5Y*: 22.02%
• 10Y*: 25.19%

CAT

• 1D: 1.44%
• 1M: -1.05%
• YTD: 59.62%
• 6M: 52.94%
• 1Y: 157.79%
• 3Y*: 57.16%
• 5Y*: 35.17%
• 10Y*: 31.33%

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

XLK vs. CAT - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XLK State Street Technology Select Sector SPDR ETF	28.52%	24.61%	21.63%	56.02%	-27.73%	34.74%	43.62%	49.86%	-1.68%	34.26%
CAT Caterpillar Inc.	59.62%	60.30%	24.66%	25.95%	18.60%	15.95%	26.97%	19.51%	-17.56%	75.03%

Correlation

The correlation between XLK and CAT is 0.50, 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	0.50
Correlation (3Y) Calculated over the trailing 3-year period	0.50
Correlation (5Y) Calculated over the trailing 5-year period	0.47
Correlation (10Y) Calculated over the trailing 10-year period	0.46
Correlation (All Time) Calculated using the full available price history since Dec 22, 1998	0.48

The correlation between XLK and CAT has been stable across timeframes, ranging from 0.46 to 0.50 - a consistent structural relationship.

Return for Risk

XLK vs. CAT — Risk / Return Rank

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

XLK

XLK Risk / Return Rank: 76
XLK Sharpe Ratio Rank: 85
XLK Sortino Ratio Rank: 76
XLK Omega Ratio Rank: 78
XLK Calmar Ratio Rank: 75
XLK Martin Ratio Rank: 68

CAT

CAT Risk / Return Rank: 98
CAT Sharpe Ratio Rank: 98
CAT Sortino Ratio Rank: 98
CAT Omega Ratio Rank: 97
CAT Calmar Ratio Rank: 98
CAT Martin Ratio Rank: 99

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.

XLK vs. CAT - Risk-Adjusted Trends Comparison

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

	XLK	CAT	Difference
Sharpe ratio: Return per unit of total volatility	2.37	4.43	-2.06
Sortino ratio: Return per unit of downside risk	2.92	5.03	-2.12
Omega ratio: Gain probability vs. loss probability	1.39	1.65	-0.25
Calmar ratio: Return relative to maximum drawdown	3.36	11.24	-7.88
Martin ratio: Return relative to average drawdown	10.85	36.80	-25.95

XLK vs. CAT - Sharpe Ratio Comparison

The current XLK Sharpe Ratio is 2.37, which is lower than the CAT Sharpe Ratio of 4.43. The chart below compares the historical Sharpe Ratios of XLK and CAT, 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

XLK vs. CAT - Drawdown Comparison

The maximum XLK drawdown since its inception was -82.05%, which is greater than CAT's maximum drawdown of -73.43%. Use the drawdown chart below to compare losses from any high point for XLK and CAT.

Drawdown Indicators

	XLK	CAT	Difference
Max Drawdown Largest peak-to-trough decline	-82.05%	-73.43%	-8.62%
Max Drawdown (1Y) Largest decline over 1 year	-15.92%	-13.88%	-2.04%
Max Drawdown (3Y) Largest decline over 3 years	-25.66%	-34.05%	+8.39%
Max Drawdown (5Y) Largest decline over 5 years	-33.56%	-34.05%	+0.49%
Max Drawdown (10Y) Largest decline over 10 years	-33.56%	-43.36%	+9.80%
Current Drawdown Current decline from peak	-6.77%	-3.18%	-3.59%
Average Drawdown Average peak-to-trough decline	-34.93%	-19.73%	-15.20%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.92%	4.23%	+0.69%

Volatility

XLK vs. CAT - Volatility Comparison

The current volatility for State Street Technology Select Sector SPDR ETF (XLK) is 10.86%, while Caterpillar Inc. (CAT) has a volatility of 13.16%. This indicates that XLK experiences smaller price fluctuations and is considered to be less risky than CAT based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XLK	CAT	Difference
Volatility (1M) Calculated over the trailing 1-month period	10.86%	13.16%	-2.30%
Volatility (6M) Calculated over the trailing 6-month period	18.92%	28.37%	-9.45%
Volatility (1Y) Calculated over the trailing 1-year period	22.55%	35.19%	-12.64%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	25.18%	30.79%	-5.61%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.64%	30.98%	-6.34%

Dividends

XLK vs. CAT - Dividend Comparison

XLK's dividend yield for the trailing twelve months is around 0.41%, less than CAT's 0.66% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
CAT Caterpillar Inc.	0.66%	1.02%	1.49%	1.69%	1.93%	2.07%	2.26%	2.56%	2.58%	1.97%	3.32%	4.33%
XLK State Street Technology Select Sector SPDR ETF	0.41%	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 XLK and CAT in my portfolio?

XLK and CAT have a correlation of 0.50, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XLK or CAT?

CAT has higher volatility (13.16%) compared to XLK (10.86%). In terms of maximum drawdown, XLK dropped -82.05% vs CAT's -73.43%.

Which has better risk-adjusted returns?

CAT currently has the higher Sharpe Ratio (4.43 vs 2.37), 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.