XLU vs. VEA

Last updated Jun 9, 2026

XLU (State Street Utilities Select Sector SPDR ETF) and VEA (Vanguard FTSE Developed Markets ETF) are both exchange-traded funds - XLU is a Utilities Equities fund tracking the Utilities Select Sector Index, while VEA is a Foreign Large Cap Equities fund tracking the FTSE Developed All Cap ex US Index. Both are passively managed. Over the past 10 years, XLU returned 8.99%/yr vs 10.14%/yr for VEA. At a 0.44 correlation, their price movements are largely independent. XLU charges 0.08%/yr vs 0.03%/yr for VEA.

Performance

XLU vs. VEA - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in State Street Utilities Select Sector SPDR ETF (XLU) and Vanguard FTSE Developed Markets ETF (VEA). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, XLU achieves a 2.66% return, which is significantly lower than VEA's 12.02% return. Over the past 10 years, XLU has underperformed VEA with an annualized return of 8.99%, while VEA has yielded a comparatively higher 10.14% annualized return.

XLU

• 1D: -1.87%
• 1M: -2.68%
• YTD: 2.66%
• 6M: 3.35%
• 1Y: 10.26%
• 3Y*: 12.85%
• 5Y*: 9.10%
• 10Y*: 8.99%

VEA

• 1D: 1.00%
• 1M: -1.37%
• YTD: 12.02%
• 6M: 14.95%
• 1Y: 28.06%
• 3Y*: 18.65%
• 5Y*: 9.09%
• 10Y*: 10.14%

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

XLU vs. VEA - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XLU State Street Utilities Select Sector SPDR ETF	2.66%	16.03%	23.31%	-7.18%	1.44%	17.70%	0.51%	25.93%	3.94%	12.05%
VEA Vanguard FTSE Developed Markets ETF	12.02%	35.16%	3.15%	17.93%	-15.34%	11.66%	9.71%	22.62%	-14.75%	26.42%

Correlation

The correlation between XLU and VEA is 0.26, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.26
Correlation (3Y) Calculated over the trailing 3-year period	0.34
Correlation (5Y) Calculated over the trailing 5-year period	0.37
Correlation (10Y) Calculated over the trailing 10-year period	0.32
Correlation (All Time) Calculated using the full available price history since Jul 26, 2007	0.44

The correlation between XLU and VEA shifts across timeframes, from 0.26 (1 year) to 0.44 (all time), reflecting how their relationship changes across market environments.

XLU vs. VEA - Sectors Allocation Comparison

Sectors	XLU	VEA
Utilities	100.0%	3.3%
Basic Materials	-	7.5%
Communication Services	-	3.4%
Consumer Cyclical	-	7.5%
Consumer Defensive	-	5.6%
Energy	-	5.4%
Financial Services	-	23.3%
Healthcare	-	8.2%
Industrials	-	19.2%
Real Estate	-	2.7%
Technology	-	13.8%

Return for Risk

XLU vs. VEA — Risk / Return Rank

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

XLU

XLU Risk / Return Rank: 22
XLU Sharpe Ratio Rank: 22
XLU Sortino Ratio Rank: 21
XLU Omega Ratio Rank: 21
XLU Calmar Ratio Rank: 26
XLU Martin Ratio Rank: 21

VEA

VEA Risk / Return Rank: 56
VEA Sharpe Ratio Rank: 57
VEA Sortino Ratio Rank: 55
VEA Omega Ratio Rank: 57
VEA Calmar Ratio Rank: 54
VEA Martin Ratio Rank: 58

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.

XLU vs. VEA - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for State Street Utilities Select Sector SPDR ETF (XLU) and Vanguard FTSE Developed Markets ETF (VEA). 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.

	XLU	VEA	Difference
Sharpe ratio: Return per unit of total volatility	0.71	1.75	-1.04
Sortino ratio: Return per unit of downside risk	1.04	2.39	-1.35
Omega ratio: Gain probability vs. loss probability	1.13	1.32	-0.19
Calmar ratio: Return relative to maximum drawdown	1.12	2.42	-1.30
Martin ratio: Return relative to average drawdown	2.47	9.39	-6.91
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

XLU vs. VEA - Sharpe Ratio Comparison

The current XLU Sharpe Ratio is 0.71, which is lower than the VEA Sharpe Ratio of 1.75. The chart below compares the historical Sharpe Ratios of XLU and VEA, 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

	XLU	VEA	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.71	1.75	-1.04
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.53	0.55	-0.02
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.47	0.59	-0.12
Sharpe Ratio (All Time) Calculated using the full available price history	0.40	0.24	+0.16

Drawdowns

XLU vs. VEA - Drawdown Comparison

The maximum XLU drawdown since its inception was -51.98%, smaller than the maximum VEA drawdown of -60.68%. Use the drawdown chart below to compare losses from any high point for XLU and VEA.

Drawdown Indicators

	XLU	VEA	Difference
Max Drawdown Largest peak-to-trough decline	-51.98%	-60.68%	+8.70%
Max Drawdown (1Y) Largest decline over 1 year	-9.18%	-11.63%	+2.45%
Max Drawdown (3Y) Largest decline over 3 years	-17.26%	-13.45%	-3.81%
Max Drawdown (5Y) Largest decline over 5 years	-25.26%	-29.71%	+4.45%
Max Drawdown (10Y) Largest decline over 10 years	-36.07%	-35.73%	-0.34%
Current Drawdown Current decline from peak	-8.18%	-3.40%	-4.78%
Average Drawdown Average peak-to-trough decline	-10.22%	-13.29%	+3.07%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.16%	3.00%	+1.16%

Volatility

XLU vs. VEA - Volatility Comparison

The current volatility for State Street Utilities Select Sector SPDR ETF (XLU) is 5.60%, while Vanguard FTSE Developed Markets ETF (VEA) has a volatility of 6.03%. This indicates that XLU experiences smaller price fluctuations and is considered to be less risky than VEA based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XLU	VEA	Difference
Volatility (1M) Calculated over the trailing 1-month period	5.60%	6.03%	-0.43%
Volatility (6M) Calculated over the trailing 6-month period	11.70%	13.91%	-2.21%
Volatility (1Y) Calculated over the trailing 1-year period	14.64%	16.15%	-1.51%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	17.34%	16.63%	+0.71%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	19.27%	17.40%	+1.87%

XLU vs. VEA - Expense Ratio Comparison

XLU has a 0.08% expense ratio, which is higher than VEA's 0.03% 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

XLU vs. VEA - Dividend Comparison

XLU's dividend yield for the trailing twelve months is around 2.73%, more than VEA's 2.69% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VEA Vanguard FTSE Developed Markets ETF	2.69%	3.22%	3.35%	3.15%	2.91%	3.16%	2.04%	3.04%	3.35%	2.77%	3.05%	2.92%
XLU State Street Utilities Select Sector SPDR ETF	2.73%	2.71%	2.96%	3.39%	2.92%	2.79%	3.14%	2.95%	3.33%	3.33%	3.41%	3.67%

Frequently Asked Questions

Can I hold both XLU and VEA in my portfolio?

XLU and VEA have a correlation of 0.26, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XLU or VEA?

VEA has higher volatility (6.03%) compared to XLU (5.60%). In terms of maximum drawdown, XLU dropped -51.98% vs VEA's -60.68%.

Which ETF is better, XLU or VEA?

On 10-year performance, VEA leads with 10.14% vs 8.99% for XLU. On fees, VEA is cheaper at 0.03% per year. On volatility, XLU has been the lower-risk option at 5.60%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XLU or VEA?

Over the 10-year period, VEA has performed better with a 10.14% return vs 8.99%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XLU or VEA?

VEA is cheaper with a 0.03% expense ratio, compared with 0.08% for XLU.

Which ETF pays a higher dividend yield, XLU or VEA?

XLU has the higher dividend yield at 2.73%, compared with 2.69% for VEA.

What is the main difference between XLU and VEA?

XLU is categorized as Utilities Equities, while VEA is Foreign Large Cap Equities. XLU tracks Utilities Select Sector Index, while VEA tracks FTSE Developed All Cap ex US Index. They also come from different issuers: State Street and Vanguard. Their fees differ too: 0.08% for XLU and 0.03% for VEA.

Which has better risk-adjusted returns?

VEA currently has the higher Sharpe Ratio (1.75 vs 0.70), 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.