XSW vs. XLF

Last updated Aug 2, 2026

XSW (SPDR S&P Software & Services ETF) and XLF (State Street Financial Select Sector SPDR ETF) are both exchange-traded funds - XSW is a Technology Equities fund tracking the S&P Software & Services Select Industry Index, while XLF is a Financials Equities fund tracking the Financial Select Sector Index. Both are passively managed. Over the past 10 years, XSW returned 13.43%/yr vs 13.69%/yr for XLF. Their 0.55 correlation means they have sometimes moved together and sometimes differently. XSW charges 0.35%/yr vs 0.08%/yr for XLF.

Performance

XSW vs. XLF - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in SPDR S&P Software & Services ETF (XSW) and State Street Financial Select Sector SPDR ETF (XLF). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, XSW achieves a -2.35% return, which is significantly lower than XLF's 4.86% return. Both investments have delivered pretty close results over the past 10 years, with XSW having a 13.43% annualized return and XLF not far ahead at 13.69%.

XSW

• 1D: 0.60%
• 1M: 3.56%
• 6M: 9.30%
• YTD: -2.35%
• 1Y: 0.97%
• 3Y*: 8.86%
• 5Y*: 1.40%
• 10Y*: 13.43%
• ALL TIME*: 14.98%

XLF

• 1D: -0.11%
• 1M: 2.37%
• 6M: 7.47%
• YTD: 4.86%
• 1Y: 12.50%
• 3Y*: 19.11%
• 5Y*: 11.20%
• 10Y*: 13.69%
• ALL TIME*: 6.09%

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

Liquidity Comparison

Position	Avg. Volume Value (2W)	Avg. Volume Value (1M)	Avg. Volume Value (3M)
XLF State Street Financial Select Sector SPDR ETF	$1.84B	$1.93B	$1.92B
XSW SPDR S&P Software & Services ETF	$8.95M	$8.27M	$10.07M

XSW vs. XLF - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
XSW SPDR S&P Software & Services ETF	-2.35%	-0.90%	25.81%	38.60%	-34.22%	7.47%	52.41%	36.50%	7.67%	27.94%
XLF State Street Financial Select Sector SPDR ETF	4.86%	14.90%	30.56%	12.03%	-10.59%	34.80%	-1.74%	31.88%	-13.06%	22.00%

Correlation

The correlation between XSW and XLF is 0.45, which is low. Their historical price movements had little consistent relationship.

	Correlation
Correlation (1Y) Focuses on recent behavior, but can change the most.	0.45
Correlation (3Y) Balances recent behavior with more history.	0.54
Correlation (5Y) Shows whether the relationship held over a longer period.	0.59
Correlation (10Y) Provides a long-term view across more market conditions.	0.52
Correlation (All Time) Calculated using the full available price history since Sep 29, 2011	0.55

The correlation between XSW and XLF shifts across timeframes, from 0.45 (1 year) to 0.58 (5 years), reflecting how their relationship changes across market environments.

XSW vs. XLF - Sectors Allocation Comparison

Sectors	XSW	XLF
Technology	87.3%	1.6%
Financial Services	7.1%	98.2%
Communication Services	3.3%	-
Consumer Cyclical	0.8%	-
Healthcare	0.8%	-
Industrials	0.7%	0.2%
Basic Materials	-	-
Consumer Defensive	-	-
Energy	-	-
Real Estate	-	-
Utilities	-	-

Return for Risk

XSW vs. XLF — Risk / Return Rank

Compare historical risk-adjusted metric ranks over the past 12 months.

XSW

XSW Risk / Return Rank: 10
XSW Sharpe Ratio Rank: 10
XSW Sortino Ratio Rank: 10
XSW Omega Ratio Rank: 10
XSW Calmar Ratio Rank: 10
XSW Martin Ratio Rank: 10

XLF

XLF Risk / Return Rank: 27
XLF Sharpe Ratio Rank: 29
XLF Sortino Ratio Rank: 28
XLF Omega Ratio Rank: 28
XLF Calmar Ratio Rank: 24
XLF Martin Ratio Rank: 24

The rank (0–100) uses a weighted average of the Sharpe, Sortino, Omega, Calmar, and Martin percentile ranks for the trailing 12 months. Higher means stronger historical risk-adjusted performance within the peer group.

XSW vs. XLF - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for SPDR S&P Software & Services ETF (XSW) and State Street Financial Select Sector SPDR ETF (XLF). 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.

	XSW	XLF	Difference
Sharpe ratio: Return per unit of total volatility	-0.08	0.71	-0.78
Sortino ratio: Return per unit of downside risk	0.10	1.05	-0.95
Omega ratio: Gain probability vs. loss probability	1.01	1.13	-0.12
Calmar ratio: Return relative to maximum drawdown	-0.07	0.71	-0.77
Martin ratio: Return relative to average drawdown	-0.13	1.80	-1.94

XSW vs. XLF - Sharpe Ratio Comparison

The current XSW Sharpe Ratio is -0.08, which is lower than the XLF Sharpe Ratio of 0.71. The chart below compares the historical Sharpe Ratios of XSW and XLF, 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

XSW vs. XLF - Drawdown Comparison

The maximum XSW drawdown since its inception was -45.38%, smaller than the maximum XLF drawdown of -82.69%. Use the drawdown chart below to compare losses from any high point for XSW and XLF.

Drawdown Indicators

	XSW	XLF	Difference
Max Drawdown Largest peak-to-trough decline	-45.38%	-82.69%	+37.31%
Max Drawdown (1Y) Largest decline over 1 year	-33.75%	-14.79%	-18.96%
Max Drawdown (3Y) Largest decline over 3 years	-33.75%	-15.54%	-18.21%
Max Drawdown (5Y) Largest decline over 5 years	-45.38%	-25.81%	-19.57%
Max Drawdown (10Y) Largest decline over 10 years	-45.38%	-42.86%	-2.52%
Current Drawdown Current decline from peak	-10.96%	-1.15%	-9.81%
Average Drawdown Average peak-to-trough decline	-9.90%	-19.92%	+10.02%
Ulcer Index Depth and duration of drawdowns from previous peaks	16.92%	5.79%	+11.13%

Volatility

XSW vs. XLF - Volatility Comparison

SPDR S&P Software & Services ETF (XSW) has a higher volatility of 8.03% compared to State Street Financial Select Sector SPDR ETF (XLF) at 4.07%. This indicates that XSW's price experiences larger fluctuations and is considered to be riskier than XLF based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	XSW	XLF	Difference
Volatility (1M) Calculated over the trailing 1-month period	8.03%	4.07%	+3.96%
Volatility (6M) Calculated over the trailing 6-month period	24.75%	11.10%	+13.65%
Volatility (1Y) Calculated over the trailing 1-year period	29.79%	14.77%	+15.02%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	29.15%	18.45%	+10.70%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	26.36%	22.08%	+4.28%

XSW vs. XLF - Expense Ratio Comparison

XSW has a 0.35% expense ratio, which is higher than XLF's 0.08% expense ratio.

Dividends

XSW vs. XLF - Dividend Comparison

XSW has not paid dividends to shareholders, while XLF's dividend yield for the trailing twelve months is around 1.42%.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
XLF State Street Financial Select Sector SPDR ETF	1.42%	1.31%	1.42%	1.71%	2.04%	1.63%	2.03%	1.87%	2.08%	1.48%	21.10%	1.95%
XSW SPDR S&P Software & Services ETF	0.00%	0.06%	0.07%	0.20%	0.09%	0.13%	0.26%	0.12%	0.31%	0.46%	0.87%	0.54%

Frequently Asked Questions

Can I hold both XSW and XLF in my portfolio?

XSW and XLF have a correlation of 0.45, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, XSW or XLF?

XSW has higher volatility (8.03%) compared to XLF (4.07%). In terms of maximum drawdown, XSW dropped -45.38% vs XLF's -82.69%.

Which ETF is better, XSW or XLF?

On 10-year performance, XLF leads with 13.69% vs 13.43% for XSW. On fees, XLF is cheaper at 0.08% per year. On volatility, XLF has been the lower-risk option at 4.07%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, XSW or XLF?

Over the 10-year period, XLF has performed better with a 13.69% return vs 13.43%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, XSW or XLF?

XLF is cheaper with a 0.08% expense ratio, compared with 0.35% for XSW.

Which ETF pays a higher dividend yield, XSW or XLF?

XLF has the higher dividend yield at 1.42%, compared with 0.00% for XSW.

What is the main difference between XSW and XLF?

XSW is categorized as Technology Equities, while XLF is Financials Equities. XSW tracks S&P Software & Services Select Industry Index, while XLF tracks Financial Select Sector Index. Their fees differ too: 0.35% for XSW and 0.08% for XLF.

Which has better risk-adjusted returns?

XLF currently has the higher Sharpe Ratio (0.71 vs -0.08), 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.