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ETF Comparison

VDC vs XLP: Which Is the Better Pick in 2026?

A head-to-head comparison of Vanguard Consumer Staples ETF and Consumer Staples Select Sector SPDR Fund covering yield, cost, risk, and income potential.

Data updated September 4, 2026

Best for

  • VDCInvestors who want broad equity exposure.
  • XLPInvestors who want higher current income (2.71% vs 2.14% for VDC).

Jump to the side-by-side numbers

Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

VDC has lagged XLP over the trailing twelve months, posting a 6.45% total return against 7.87%. The picture flips over 10 years, though — VDC has compounded at 7.57% a year, ahead of XLP at 7.26%. Figures are total returns: price change plus every distribution reinvested.

Total return and risk statistics by fund. Each row is one fund; each column is one period or statistic.
SymbolYTD1Y3Y5Y10YSince Jan 2004Volatility Sharpe Sortino Max drawdown
VDC9.45%6.45%9.07%6.37%7.57%9.36%12.7%0.330.48-9.3%
XLP10.25%7.87%8.67%5.79%7.26%8.92%12.9%0.300.42-9.7%

Total return with all distributions reinvested on the ex-dividend date (a modeling convention, not the cash-settlement date), split-adjusted, as of September 4, 2026. YTD and 1Y are cumulative; windows of one year or longer are annualized. “Since Jan 2004” measures every fund from January 30, 2004 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Side-by-side snapshot

Side-by-side snapshot. Each row is one metric; each column is one fund.
MetricVDCXLP
Full nameVanguard Consumer Staples ETFConsumer Staples Select Sector SPDR Fund
IssuerVanguardState Street
Underlying indexMSCI US Investable Market Consumer Staples 25/50 IndexConsumer Staples Select Sector Index
Last Close$228.34 as of September 4, 2026$84.58 as of September 4, 2026
Distribution yield2.14%2.71%
Distribution Safety Score™ 9292
Safety-Adjusted Yield 1.97%2.49%
Expense ratio0.09%0.08%
AUM$7.88B$14.5B
Distribution frequencyQuarterlyQuarterly
ObjectiveTracks the MSCI US Investable Market Consumer Staples 25/50 Index.Tracks the Consumer Staples Select Sector Index from the S&P 500.
Asset classEquityEquity
Inception date01/26/200412/16/1998
Beta0.530.52
Last dividend$1.224$0.574
Ex-dividend date06/24/202606/22/2026

Bottom lineChoose VDC if you want broad equity exposure. Choose XLP if you want higher current income (2.71% vs 2.14% for VDC).

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Income calculator

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Vanguard
ETFs116
Total AUM$4650B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

Vanguard is one of the largest and most established ETF issuers, known for low-cost, broadly diversified fund offerings built on passive indexing principles. Their lineup spans multiple asset classes and strategies, including core equity and bond index funds, dividend-focused portfolios, ESG-screened options, factor-based strategies, sector exposure, target-date retirement funds, and international investments across developed and emerging markets. The platform is characterized by its emphasis on accessibility and cost efficiency across a comprehensive range of fund families, serving both individual investors seeking broad market exposure and those pursuing specific income, sustainability, or thematic objectives.

See our curated list of related YouTube videos on VDC.

See all Vanguard ETFs
State Street
ETFs179
Total AUM$2124B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

State Street Global Advisors (SSGA) is one of the largest ETF providers globally, known for its flagship SPDR suite of exchange-traded products that serve both institutional and retail investors across a broad range of asset classes. Their 88-fund lineup spans diverse strategies including sector exposure (Select Sector SPDR), income generation (Income and Select Sector SPDR Premium Income families), commodities (including the widely-held GLD gold ETF), bonds, ESG-focused investments, and thematic allocations, with popular tickers like DIA (Diamonds Trust), FEZ (Eurozone exposure), and JNK (high-yield bonds) among their most recognized funds. The issuer is characterized by its comprehensive coverage across multiple market segments and its emphasis on both traditional index-based products and specialized strategies like covered call income funds and factor-based investing.

See our curated list of related YouTube videos on XLP.

See all State Street ETFs

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Quick verdict

VDC (Vanguard Consumer Staples ETF) and XLP (Consumer Staples Select Sector SPDR Fund) are both quarterly-pay dividend ETFs, but they take different approaches.

XLP offers the higher yield at 2.71% vs 2.14% for VDC. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

XLP is cheaper with an expense ratio of 0.08% compared to 0.09%.

They have different reference exposures: VDC is linked to MSCI US Investable Market Consumer Staples 25/50 Index while XLP is linked to Consumer Staples Select Sector Index, which means their performance drivers differ.

XLP is the larger fund by assets ($14.5B), which generally means tighter spreads and better liquidity.

Deep dive

Yield & income

On a $10,000 investment, VDC would generate roughly $17.83/month, while XLP would produce $22.58/month, at current distribution rates. Both pay quarterly distributions.

VDC yield2.14%
XLP yield2.71%
Monthly diff on $10K$4.75

Cost & efficiency

Over 10 years on $10,000, VDC would cost approximately $90 in fees vs $80 for XLP (simplified, not compounded). The $10.00 difference may be offset by yield or performance.

VDC ER0.09%
XLP ER0.08%

Strategy & risk

VDC tracks MSCI US Investable Market Consumer Staples 25/50 Index, while XLP tracks Consumer Staples Select Sector Index. Beta is 0.53 for VDC and 0.52 for XLP — effectively similar market sensitivity.

VDC beta0.53
XLP beta0.52

Fund details

VDC is managed by Vanguard (launched 01/26/2004) with $7.88B in assets. XLP is managed by State Street (launched 12/16/1998) with $14.5B in assets.

VDC AUM$7.88B
XLP AUM$14.5B
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Frequently asked questions

What is the current distribution yield for VDC and XLP?

VDC currently distributes 2.14% and XLP 2.71%, based on fund data updated September 2026. Distribution yield moves with both the payout and the share price, so check the as-of date before relying on either figure.

Is VDC or XLP better for dividend income?

It depends on your goals. XLP currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between VDC and XLP?

VDC (Vanguard Consumer Staples ETF) tracks MSCI US Investable Market Consumer Staples 25/50 Index, while XLP (Consumer Staples Select Sector SPDR Fund) tracks Consumer Staples Select Sector Index. They are issued by Vanguard and State Street respectively.

Can I hold both VDC and XLP?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Is VDC or XLP safer?

By Dividend Vision's Distribution Safety Score — a rules-based 0–100 estimate of how resilient a distribution looks, where higher is safer — they are effectively tied: VDC scores 92, XLP scores 92. Neither has a clear safety edge on that measure. No score makes an investment risk-free — treat this as a screening signal, not a guarantee.

Which has lower fees, VDC or XLP?

VDC has an expense ratio of 0.09% while XLP charges 0.08%. Lower fees mean more of your investment returns stay in your pocket over time.

How much income does $10,000 in VDC vs XLP generate?

At current rates, $10,000 in VDC would generate roughly $17.83 per month ($214.00 annually). The same in XLP would produce about $22.58 per month ($271.00 annually).

Which has performed better historically, VDC or XLP?

VDC has lagged XLP over the trailing twelve months, posting a 6.45% total return against 7.87%. The picture flips over 10 years, though — VDC has compounded at 7.57% a year, ahead of XLP at 7.26%. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.

More comparisons to explore

VDC vs XLP — at a glance

Generated August 29, 2026.

Overview

Both VDC and XLP are large, low-cost consumer staples equity ETFs that track different indexes and offer quarterly distributions. The key difference: VDC uses a broader MSCI index that includes companies outside the S&P 500, while XLP tracks only the consumer staples stocks within the S&P 500 itself, making XLP narrower and more concentrated among mega-cap names.

How they differ

XLP's 2.71% distribution rate exceeds VDC's 2.14%, but XLP holds a tighter roster of S&P 500 staples only, whereas VDC captures the full investable market including mid- and small-cap staples. XLP is roughly 85% larger by assets ($14.5B versus $7.88B) and has a slightly lower expense ratio at 0.08% versus VDC's 0.09%, but both are negligible cost differences. Both have nearly identical beta around 0.52–0.53, signaling similar downside cushioning relative to the broader market. XLP's longer inception (December 1998 versus January 2004) reflects its position as an earlier Select Sector SPDR product.

Who each is best for

VDC: Fits investors seeking broader exposure to the U.S. consumer staples segment, including established mid- and small-cap names that the S&P 500 may underweight or exclude.

XLP: Designed for investors comfortable with S&P 500–only staples exposure who prioritize the higher current yield and the liquidity that comes with larger AUM.

Key risks to know

  • Index composition and overlap risk. VDC and XLP's underlying indexes will contain overlapping holdings—likely the same mega-cap staples (Procter & Gamble, Coca-Cola, Mondelez, etc.). Holdings-level detail is not available here, so overlap concentration should be verified before holding both.
  • Yield sustainability and lower beta. Both funds' betas (0.52–0.53) indicate they underperform in strong bull markets. XLP's higher yield may leave less room for price appreciation if the staples sector faces valuation pressure.
  • S&P 500 concentration in XLP. By design, XLP excludes staples names outside the S&P 500, potentially missing diversification opportunities in the broader market that VDC captures.
  • Sector-level sensitivity. Consumer staples are defensive but face headwinds from inflation, input costs, and changing consumer behavior. Both funds move together in sector downturns.

Bottom line

If you want broader exposure across the entire investable staples universe and are willing to accept slightly lower current yield, VDC stands out. If you prefer S&P 500–only staples with higher income and don't mind the larger AUM concentration, XLP's yield advantage and tighter index justify the choice. Past performance doesn't predict future results.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

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The metrics behind this comparison, explained in the Academy.

How to read a fund's stats How expense ratios eat returns Correlation between two funds

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