What are the main differences between XLK and XLY?

XLK focuses on technology companies like NVDA and AAPL, while XLY targets consumer cyclical firms such as AMZN and TSLA. Both share the same 0.08% expense ratio, but their holdings, asset base, and sector exposure differ significantly.

How do ETFs work and what should I look for when comparing them?

ETFs are baskets of securities that trade on an exchange. When comparing them, look at the expense ratio, asset base, dividend yield, top holdings, and the market sector each fund targets.

What does 'expense ratio' mean in the context of ETFs?

The expense ratio is the annual fee charged by the ETF, based on a percentage of assets under management. For XLK and XLY, both have a low expense ratio of 0.08%, which is favourable for cost-conscious investors.

Which ETF has higher liquidity, XLK or XLY?

XLK is more liquid due to its large asset base of $123.2 billion compared to XLY's $21.8 billion. This may make XLK easier to trade in larger quantities without affecting the price.

How do the dividend yields of XLK and XLY compare?

XLY offers a modest yield of 0.83%, providing some income, whereas XLK's yield is low at 0.43%. This makes XLY more suitable for investors looking for income generation alongside growth.

What are the top holdings of XLK and XLY?

XLK's top holdings include NVDA, AAPL, and MSFT, while XLY's include AMZN and TSLA. There is no overlap among the top ten holdings of the two funds.

Are XLK and XLY both concentrated in their holdings?

Yes, both ETFs show high concentration. XLK's top 10 holdings comprise nearly 60% of assets, while XLY's top two, AMZN and TSLA, exceed 41% of its assets combined.

How does a lower expense ratio affect an investor's long-term returns?

A lower expense ratio means less of your investment is eaten up by fees, leaving more for potential growth. Over time, even small fee differences can compound significantly, affecting overall returns.

How do XLK and XLY track their respective markets?

Index tracking details are not available for XLK and XLY. However, both funds aim to follow their respective sectors closely, providing targeted exposure to technology and consumer cyclical stocks.

What are the risks of high concentration in sector ETFs like XLK and XLY?

High concentration means the ETF's performance is heavily influenced by a few companies. If those companies perform poorly, the entire fund could be negatively impacted, leading to higher risk.

Is XLK or XLY better for long-term growth?

The choice between XLK and XLY for long-term growth depends on your strategy. XLK is geared towards technology stocks, while XLY covers consumer cyclical companies, offering different growth avenues.

Can I buy and sell ETFs like XLK and XLY at any time?

ETFs can be bought and sold throughout the trading day at the current market price, similar to stocks. Their trading hours and liquidity affect how easily you can enter or exit a position.

XLK vs XLY

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

Compare XLK (Technology Sector SPDR) with XLY (Consumer Discret Sel Sect SPDR ETF). This page examines fees, holdings, dividends and how each fund tracks its market. XLK focuses on technology, while XLY targets consumer cyclical companies. Both share the same 0.08% expense ratio. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

XLK

Metric

XLY

0.08%

Expense Ratio

0.08%

0.43%

Dividend Yield

0.83%

$123.19B

Net Assets

$21.78B

Holdings

Dec 16, 1998

Inception Date

Dec 16, 1998

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Index Tracked

–

Technology

Fund Category

Consumer Cyclical

Both funds charge the same annual fee.

Shared Top Holdings

These funds do not share any of their top holdings.

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Investment Analysis

XLK

Pros

XLK benefits from a low expense ratio of 0.08% on $123.2 billion in assets
XLK provides exposure to major technology companies like NVDA and AAPL
XLK's high liquidity supports efficient trading due to its large asset base

Considerations

XLK has a very low dividend yield of 0.43% limiting income generation
XLK exhibits high concentration with top 10 holdings comprising nearly 60% of assets
XLK lacks available index methodology details to assess underlying rules and rebalancing

XLY

Pros

XLY offers a modest 0.83% yield providing some income alongside capital growth
XLY maintains a competitive 0.08% expense ratio for sector exposure
XLY includes diverse consumer cyclical firms like AMZN and TSLA

Considerations

XLY shows extreme concentration with AMZN and TSLA exceeding 41% of assets combined
XLY manages smaller $21.8 billion in assets potentially limiting liquidity
XLY does not provide available data on index tracked or methodology

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About XLK and XLY

XLK (XLK)

Technology Sector SPDR (XLK) is an exchange‑traded fund designed to give investors broad exposure to the US technology sector by tracking a technology‑focused index. It concentrates on large‑capitalisation companies across software, hardware, semiconductors and IT services, so holdings are often dominated by a handful of industry leaders. The ETF is passively managed, typically has a low expense ratio relative to actively managed funds, and can serve as a straightforward way to gain sector exposure without selecting individual stocks. Investors should be aware of sector concentration risk, sensitivity to interest‑rate changes and valuation swings, and the cyclicality of technology spending. XLK is suitable for those seeking long‑term exposure to technology trends but not as a substitute for a diversified portfolio. This is general information only and not personal advice; values can rise and fall and past performance does not predict future returns.

XLY (XLY)

XLY (Consumer Discret Sel Sect SPDR ETF) is a sector-focused exchange-traded fund that provides targeted exposure to US consumer discretionary companies — firms in retail, leisure, autos, media and related services. As a sector ETF, it concentrates on businesses whose revenues are sensitive to consumer spending and economic cycles, so it tends to be more growth-oriented and can be more volatile than broad-market funds. Investors use XLY to gain concentrated exposure to trends in retail, e-commerce, travel and durable goods, or to express a view on consumer demand. Because it focuses on a single sector, diversification is limited and performance can swing with the economic cycle. This summary is for educational purposes only and not personalised advice. Consider your investment goals, risk tolerance and the ETF’s suitability for your portfolio; values and income can fall as well as rise.

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XLK vs XLY

Fund Snapshot