XLV vs. VWO

Last updated Jun 13, 2026

XLV (State Street Health Care Select Sector SPDR ETF) and VWO (Vanguard FTSE Emerging Markets ETF) are both exchange-traded funds - XLV is a Health & Biotech Equities fund tracking the Health Care Select Sector Index, while VWO is a Emerging Markets Equities fund tracking the FTSE Emerging Index. Both are passively managed. Over the past 10 years, XLV returned 9.81%/yr vs 9.00%/yr for VWO. A 0.51 correlation means they provide meaningful diversification when combined. Both charge a 0.08% expense ratio.

Performance

XLV vs. VWO - Performance Comparison

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

Returns By Period

In the year-to-date period, XLV achieves a -0.23% return, which is significantly lower than VWO's 10.77% return. Over the past 10 years, XLV has outperformed VWO with an annualized return of 9.81%, while VWO has yielded a comparatively lower 9.00% annualized return.

XLV

• 1D: -0.18%
• 1M: 4.84%
• YTD: -0.23%
• 6M: 0.67%
• 1Y: 14.43%
• 3Y*: 7.12%
• 5Y*: 6.00%
• 10Y*: 9.81%

VWO

• 1D: 0.76%
• 1M: -0.65%
• YTD: 10.77%
• 6M: 12.57%
• 1Y: 24.61%
• 3Y*: 16.61%
• 5Y*: 5.03%
• 10Y*: 9.00%

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

XLV vs. VWO - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XLV State Street Health Care Select Sector SPDR ETF	-0.23%	14.50%	2.47%	2.07%	-2.08%	26.04%	13.30%	20.45%	6.28%	21.77%
VWO Vanguard FTSE Emerging Markets ETF	10.77%	25.60%	10.59%	9.25%	-17.98%	1.26%	15.17%	20.75%	-14.76%	31.49%

Correlation

The correlation between XLV and VWO is 0.25, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.25
Correlation (3Y) Calculated over the trailing 3-year period	0.27
Correlation (5Y) Calculated over the trailing 5-year period	0.33
Correlation (10Y) Calculated over the trailing 10-year period	0.42
Correlation (All Time) Calculated using the full available price history since Mar 10, 2005	0.51

Over the past year, the correlation between XLV and VWO has dropped to 0.25 - well below their long-term average of 0.51, suggesting their price drivers have been diverging.

XLV vs. VWO - Sectors Allocation Comparison

Sectors	XLV	VWO
Healthcare	100.0%	3.9%
Basic Materials	-	8.0%
Communication Services	-	7.1%
Consumer Cyclical	-	10.7%
Consumer Defensive	-	3.7%
Energy	-	4.6%
Financial Services	-	19.5%
Industrials	-	8.0%
Real Estate	-	2.2%
Technology	-	29.6%
Utilities	-	2.9%

Return for Risk

XLV vs. VWO — Risk / Return Rank

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

XLV

XLV Risk / Return Rank: 30
XLV Sharpe Ratio Rank: 30
XLV Sortino Ratio Rank: 33
XLV Omega Ratio Rank: 28
XLV Calmar Ratio Rank: 32
XLV Martin Ratio Rank: 27

VWO

VWO Risk / Return Rank: 50
VWO Sharpe Ratio Rank: 49
VWO Sortino Ratio Rank: 47
VWO Omega Ratio Rank: 51
VWO Calmar Ratio Rank: 50
VWO Martin Ratio Rank: 52

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.

XLV vs. VWO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for State Street Health Care Select Sector SPDR ETF (XLV) and Vanguard FTSE Emerging Markets ETF (VWO). 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.

	XLV	VWO	Difference
Sharpe ratio: Return per unit of total volatility	0.97	1.49	-0.53
Sortino ratio: Return per unit of downside risk	1.55	2.10	-0.54
Omega ratio: Gain probability vs. loss probability	1.17	1.28	-0.11
Calmar ratio: Return relative to maximum drawdown	1.38	2.21	-0.83
Martin ratio: Return relative to average drawdown	3.31	7.80	-4.49

XLV vs. VWO - Sharpe Ratio Comparison

The current XLV Sharpe Ratio is 0.97, which is lower than the VWO Sharpe Ratio of 1.49. The chart below compares the historical Sharpe Ratios of XLV and VWO, 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

XLV vs. VWO - Drawdown Comparison

The maximum XLV drawdown since its inception was -39.17%, smaller than the maximum VWO drawdown of -67.68%. Use the drawdown chart below to compare losses from any high point for XLV and VWO.

Drawdown Indicators

	XLV	VWO	Difference
Max Drawdown Largest peak-to-trough decline	-39.17%	-67.68%	+28.51%
Max Drawdown (1Y) Largest decline over 1 year	-10.47%	-11.17%	+0.70%
Max Drawdown (3Y) Largest decline over 3 years	-17.11%	-17.37%	+0.26%
Max Drawdown (5Y) Largest decline over 5 years	-17.11%	-32.60%	+15.49%
Max Drawdown (10Y) Largest decline over 10 years	-28.40%	-36.39%	+7.99%
Current Drawdown Current decline from peak	-3.59%	-2.68%	-0.91%
Average Drawdown Average peak-to-trough decline	-7.12%	-15.80%	+8.68%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.37%	3.17%	+1.20%

Volatility

XLV vs. VWO - Volatility Comparison

The current volatility for State Street Health Care Select Sector SPDR ETF (XLV) is 4.90%, while Vanguard FTSE Emerging Markets ETF (VWO) has a volatility of 6.64%. This indicates that XLV experiences smaller price fluctuations and is considered to be less risky than VWO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XLV	VWO	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.90%	6.64%	-1.74%
Volatility (6M) Calculated over the trailing 6-month period	10.60%	14.04%	-3.44%
Volatility (1Y) Calculated over the trailing 1-year period	15.03%	16.54%	-1.51%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	14.75%	17.48%	-2.73%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	16.58%	19.22%	-2.64%

XLV vs. VWO - Expense Ratio Comparison

Both XLV and VWO have an expense ratio of 0.08%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.

Dividends

XLV vs. VWO - Dividend Comparison

XLV's dividend yield for the trailing twelve months is around 1.63%, less than VWO's 2.44% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VWO Vanguard FTSE Emerging Markets ETF	2.44%	2.79%	3.20%	3.52%	4.11%	2.63%	1.91%	3.23%	2.88%	2.30%	2.52%	3.26%
XLV State Street Health Care Select Sector SPDR ETF	1.63%	1.60%	1.67%	1.59%	1.47%	1.33%	1.49%	2.17%	1.57%	1.47%	1.60%	1.43%

Frequently Asked Questions

Can I hold both XLV and VWO in my portfolio?

XLV and VWO have a correlation of 0.25, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XLV or VWO?

VWO has higher volatility (6.64%) compared to XLV (4.90%). In terms of maximum drawdown, XLV dropped -39.17% vs VWO's -67.68%.

Which ETF is better, XLV or VWO?

On 10-year performance, XLV leads with 9.81% vs 9.00% for VWO. Both ETFs have the same 0.08% expense ratio. On volatility, XLV has been the lower-risk option at 4.90%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XLV or VWO?

Over the 10-year period, XLV has performed better with a 9.81% return vs 9.00%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XLV or VWO?

XLV and VWO have the same expense ratio: 0.08% per year.

Which ETF pays a higher dividend yield, XLV or VWO?

VWO has the higher dividend yield at 2.44%, compared with 1.63% for XLV.

What is the main difference between XLV and VWO?

XLV is categorized as Health & Biotech Equities, while VWO is Emerging Markets Equities. XLV tracks Health Care Select Sector Index, while VWO tracks FTSE Emerging Index. They also come from different issuers: State Street and Vanguard.

Which has better risk-adjusted returns?

VWO currently has the higher Sharpe Ratio (1.49 vs 0.97), 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.