XLK vs. ITA

Last updated Jun 24, 2026

XLK (State Street Technology Select Sector SPDR ETF) and ITA (iShares U.S. Aerospace & Defense ETF) are both exchange-traded funds - XLK is a Technology Equities fund tracking the S&P Technology Select Sector Daily Capped 35/20 Index, while ITA is a Aerospace & Defense fund tracking the Dow Jones U.S. Select Aerospace & Defense Index. Both are passively managed. Over the past 10 years, XLK returned 25.48%/yr vs 15.66%/yr for ITA. A 0.61 correlation means they provide meaningful diversification when combined. XLK charges 0.08%/yr vs 0.38%/yr for ITA.

Performance

XLK vs. ITA - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in State Street Technology Select Sector SPDR ETF (XLK) and iShares U.S. Aerospace & Defense ETF (ITA). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, XLK achieves a 28.25% return, which is significantly higher than ITA's 10.04% return. Over the past 10 years, XLK has outperformed ITA with an annualized return of 25.48%, while ITA has yielded a comparatively lower 15.66% annualized return.

XLK

• 1D: -4.14%
• 1M: 2.23%
• YTD: 28.25%
• 6M: 26.51%
• 1Y: 52.47%
• 3Y*: 30.61%
• 5Y*: 21.34%
• 10Y*: 25.48%

ITA

• 1D: 0.18%
• 1M: 4.76%
• YTD: 10.04%
• 6M: 7.54%
• 1Y: 29.57%
• 3Y*: 28.50%
• 5Y*: 17.14%
• 10Y*: 15.66%

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

XLK vs. ITA - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XLK State Street Technology Select Sector SPDR ETF	28.25%	24.61%	21.63%	56.02%	-27.73%	34.74%	43.62%	49.86%	-1.68%	34.26%
ITA iShares U.S. Aerospace & Defense ETF	10.04%	48.64%	15.81%	14.33%	9.96%	9.39%	-13.57%	30.51%	-7.22%	35.24%

Correlation

The correlation between XLK and ITA is 0.38, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.38
Correlation (3Y) Calculated over the trailing 3-year period	0.39
Correlation (5Y) Calculated over the trailing 5-year period	0.48
Correlation (10Y) Calculated over the trailing 10-year period	0.49
Correlation (All Time) Calculated using the full available price history since May 5, 2006	0.61

Over the past year, the correlation between XLK and ITA has dropped to 0.38 - well below their long-term average of 0.61, suggesting their price drivers have been diverging.

XLK vs. ITA - Sectors Allocation Comparison

Sectors	XLK	ITA
Technology	99.7%	0.1%
Energy	0.2%	-
Industrials	0.1%	99.6%
Basic Materials	-	-
Communication Services	-	-
Consumer Cyclical	-	-
Consumer Defensive	-	-
Financial Services	-	-
Healthcare	-	-
Real Estate	-	-
Utilities	-	-

Return for Risk

XLK vs. ITA — Risk / Return Rank

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

XLK

XLK Risk / Return Rank: 66
XLK Sharpe Ratio Rank: 73
XLK Sortino Ratio Rank: 61
XLK Omega Ratio Rank: 64
XLK Calmar Ratio Rank: 68
XLK Martin Ratio Rank: 61

ITA

ITA Risk / Return Rank: 38
ITA Sharpe Ratio Rank: 40
ITA Sortino Ratio Rank: 41
ITA Omega Ratio Rank: 37
ITA Calmar Ratio Rank: 39
ITA Martin Ratio Rank: 34

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. ITA - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for State Street Technology Select Sector SPDR ETF (XLK) and iShares U.S. Aerospace & Defense ETF (ITA). 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	ITA	Difference
Sharpe ratio: Return per unit of total volatility	2.25	1.36	+0.89
Sortino ratio: Return per unit of downside risk	2.77	2.01	+0.76
Omega ratio: Gain probability vs. loss probability	1.38	1.24	+0.14
Calmar ratio: Return relative to maximum drawdown	3.31	1.88	+1.43
Martin ratio: Return relative to average drawdown	10.56	4.93	+5.63

XLK vs. ITA - Sharpe Ratio Comparison

The current XLK Sharpe Ratio is 2.25, which is higher than the ITA Sharpe Ratio of 1.36. The chart below compares the historical Sharpe Ratios of XLK and ITA, 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. ITA - Drawdown Comparison

The maximum XLK drawdown since its inception was -82.05%, which is greater than ITA's maximum drawdown of -59.72%. Use the drawdown chart below to compare losses from any high point for XLK and ITA.

Drawdown Indicators

	XLK	ITA	Difference
Max Drawdown Largest peak-to-trough decline	-82.05%	-59.72%	-22.33%
Max Drawdown (1Y) Largest decline over 1 year	-15.92%	-15.82%	-0.10%
Max Drawdown (3Y) Largest decline over 3 years	-25.66%	-15.82%	-9.84%
Max Drawdown (5Y) Largest decline over 5 years	-33.56%	-18.72%	-14.84%
Max Drawdown (10Y) Largest decline over 10 years	-33.56%	-51.00%	+17.44%
Current Drawdown Current decline from peak	-6.96%	-5.72%	-1.24%
Average Drawdown Average peak-to-trough decline	-34.90%	-9.45%	-25.45%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.98%	6.01%	-1.03%

Volatility

XLK vs. ITA - Volatility Comparison

State Street Technology Select Sector SPDR ETF (XLK) has a higher volatility of 12.51% compared to iShares U.S. Aerospace & Defense ETF (ITA) at 8.49%. This indicates that XLK's price experiences larger fluctuations and is considered to be riskier than ITA based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XLK	ITA	Difference
Volatility (1M) Calculated over the trailing 1-month period	12.51%	8.49%	+4.02%
Volatility (6M) Calculated over the trailing 6-month period	19.70%	18.48%	+1.22%
Volatility (1Y) Calculated over the trailing 1-year period	23.48%	21.90%	+1.58%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	25.37%	20.23%	+5.14%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.71%	23.23%	+1.48%

XLK vs. ITA - Expense Ratio Comparison

XLK has a 0.08% expense ratio, which is lower than ITA's 0.38% expense ratio.

Dividends

XLK vs. ITA - Dividend Comparison

XLK's dividend yield for the trailing twelve months is around 0.43%, less than ITA's 0.45% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
ITA iShares U.S. Aerospace & Defense ETF	0.45%	0.55%	0.85%	0.93%	0.95%	0.82%	1.07%	1.54%	1.13%	0.91%	1.07%	1.04%
XLK State Street Technology Select Sector SPDR ETF	0.43%	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 ITA in my portfolio?

XLK and ITA have a correlation of 0.38, 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 ITA?

XLK has higher volatility (12.51%) compared to ITA (8.49%). In terms of maximum drawdown, XLK dropped -82.05% vs ITA's -59.72%.

Which ETF is better, XLK or ITA?

On 10-year performance, XLK leads with 25.48% vs 15.66% for ITA. On fees, XLK is cheaper at 0.08% per year. On volatility, ITA has been the lower-risk option at 8.49%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XLK or ITA?

Over the 10-year period, XLK has performed better with a 25.48% return vs 15.66%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XLK or ITA?

XLK is cheaper with a 0.08% expense ratio, compared with 0.38% for ITA.

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

ITA has the higher dividend yield at 0.45%, compared with 0.43% for XLK.

What is the main difference between XLK and ITA?

XLK is categorized as Technology Equities, while ITA is Aerospace & Defense. XLK tracks S&P Technology Select Sector Daily Capped 35/20 Index, while ITA tracks Dow Jones U.S. Select Aerospace & Defense Index. They also come from different issuers: State Street and iShares. Their fees differ too: 0.08% for XLK and 0.38% for ITA.

Which has better risk-adjusted returns?

XLK currently has the higher Sharpe Ratio (2.25 vs 1.36), 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.