What are consumer staples ETFs?

Consumer staples ETFs, such as IYK and XLP, invest in companies producing essential goods like food, beverages, and household items. These sectors are often considered defensive because demand for their products tends to remain stable regardless of economic conditions. Both funds fall under the Consumer Defensive category, offering exposure to businesses that provide daily necessities. Investors often look to these funds for relatively predictable revenue streams, though actual performance can vary based on market dynamics and individual company results.

How do ETFs generate returns?

ETFs like IYK and XLP generate returns through two primary mechanisms: capital appreciation and dividend income. Capital appreciation occurs when the value of the underlying stocks increases, raising the ETF's net asset value. Dividend income is received when the constituent companies pay out portions of their profits. ETFs typically pass these distributions to shareholders. The total return depends on the performance of the specific companies within the fund, as seen in the top holdings such as KO, PG, and WMT.

Why are expense ratios important for long-term investors?

Expense ratios represent the annual operating costs of an ETF, deducted from its assets. For example, IYK charges 0.37% while XLP charges 0.08%. Over time, higher fees can reduce the compound growth of an investment. This difference means that, all else being equal, a lower expense ratio may allow more of the investor's capital to remain invested. Understanding these costs is crucial when comparing funds with similar investment objectives, as even small differences can impact net returns over long holding periods.

How do the fees of IYK and XLP compare?

IYK has an expense ratio of 0.37%, whereas XLP charges 0.08%. This represents a difference of 0.29 percentage points in annual costs. Lower fees generally mean less drag on investment performance, assuming all other factors remain constant. Investors comparing these two consumer defensive funds should consider how such cost differences might affect net returns over various time horizons. However, fees are just one factor; the composition of holdings and tracking efficiency also play significant roles in overall fund performance and suitability for specific investment goals.

What is the dividend yield difference between the funds?

Based on the provided data, XLP has a dividend yield of 2.67%, while IYK's yield is 2.62%. The difference is minimal, at only 0.05 percentage points. Dividend yields can fluctuate due to changes in share prices or company payouts. While yields are an important consideration for income-focused investors, they do not guarantee consistent future distributions. Both funds invest in established consumer staples companies, which often have histories of paying dividends, but the specific yield at any given time reflects current market pricing and the fund's portfolio composition.

How similar are the top holdings in IYK and XLP?

There is significant overlap in the top 10 holdings of both funds. Seven stocks appear in both lists: KO, PG, PM, PEP, MO, MDLZ, and CL. However, their weightings differ. For instance, KO constitutes 13.44% of IYK but only 7.57% of XLP. Conversely, WMT and COST are top holdings in XLP but are not listed in IYK's top 10. This indicates that while both target consumer staples, their specific stock selection and concentration levels vary, leading to potentially different risk and return profiles.

Which investing goal is associated with consumer defensive funds?

Consumer defensive funds like IYK and XLP are typically associated with goals involving relative stability and income generation. Companies in this sector produce essential goods, often leading to more predictable cash flows during economic downturns compared to cyclical sectors. Investors might consider these funds if they seek lower volatility or consistent dividends, though no fund is risk-free. The specific choice between IYK and XLP might depend on preferences for fee structures, sector exposure breadth, or individual stock weighting, keeping in mind that past performance does not guarantee future results.

What index data is available for these funds?

For both IYK and XLP, the specific index tracked is listed as 'not available' in the provided dataset. Without this information, it is difficult to precisely quantify how closely each fund adheres to its intended benchmark. Generally, ETFs aim to mirror the performance of a designated index. Investors looking to understand tracking error or index methodology would need to consult the fund's official documentation, as the current data does not specify the underlying benchmarks for these two consumer defensive funds.

How do the fund sizes compare?

XLP has net assets of $13.9 billion, significantly larger than IYK's $1.4 billion. Larger fund size can sometimes correlate with higher trading liquidity and tighter bid-ask spreads, although this is not always the case. Both funds operate within the Consumer Defensive category. The difference in asset base may influence how each fund manages inflows and outflows, potentially affecting their operational efficiency and ability to maintain precise alignment with their underlying holdings without incurring higher transaction costs.

When were these funds established?

XLP was launched on December 16, 1998, while IYK began on June 12, 2000. XLP has a slightly longer operational history, having been established about a year and a half prior to IYK. A longer track record can provide more data points for historical analysis, but it does not necessarily indicate superior future performance. Both funds have operated through various market cycles, offering investors different examples of how consumer staples ETFs have managed their portfolios over nearly two to three decades.

What should beginners consider when comparing these ETFs?

Beginners should evaluate expense ratios, as seen with IYK at 0.37% and XLP at 0.08%. Additionally, they should examine top holdings, noting the overlap of stocks like KO and PG but differing concentrations. Dividend yields (2.62% for IYK and 2.67% for XLP) are also relevant for income expectations. It is important to review the 'not available' index data to understand tracking methods. Finally, consider fund size and operational history. Always align the fund's characteristics with your personal risk tolerance and investment objectives.

Is this page financial advice?

No, this page is for educational purposes only and does not constitute financial advice. The data provided, including expense ratios, net assets, and holdings for IYK and XLP, is sourced from Yahoo Finance as of September 22, 2026. Figures such as index tracks and sector weights are marked as 'not available' in this dataset. Investors should conduct their own due diligence or consult a qualified financial adviser before making any investment decisions, as market conditions and fund details may change over time.

IYK vs XLP

Two funds, one decision: we compare cost, performance and what each ETF actually holds in September 2026.

Compare IYK (iShares US Consumer Staples ETF) and XLP (Consumer Staples Select Sector SPDR). This page examines fees, holdings, dividends and how each fund tracks its market. IYK carries a 0.37% expense ratio, while XLP charges 0.08%. Both target consumer defensive sectors, yet differ in composition and cost. Educational content, not financial advice.

Compare IYK (iShares US Consumer Staples ETF) and XLP (Consumer Staples Select Sector SPDR). This page examines fees, holdings, dividends and how each fund tracks its market. IYK carries a 0.37% expen...

Fund Snapshot

Key Fund Metrics

IYK

Metric

XLP

0.37%

Expense Ratio

0.08%

2.62%

Dividend Yield

2.67%

$1.41B

Net Assets

$13.93B

57

Holdings

37

Jun 12, 2000

Inception Date

Dec 16, 1998

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Index Tracked

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Consumer Defensive

Fund Category

Consumer Defensive

XLP costs about $29.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	IYK	XLP
KOThe Coca-Cola Company	13.44%	7.57%
PGThe Procter & Gamble Company	13.38%	7.54%
PMPhilip Morris International Inc.	11.58%	6.51%
PEPPepsiCo, Inc.	7.10%	4.24%
MOAltria Group, Inc.	4.37%	4.58%
MDLZMondelez International, Inc.	3.24%	4.36%
CLColgate-Palmolive Company	3.02%	4.44%

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VDC vs XLP

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Investment Analysis

IYK

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XLP

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