A head-to-head comparison of Vanguard Financials ETF and State Street Financial Select Sector SPDR ETF covering yield, cost, risk, and income potential.
ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.
Vanguard is known for offering low-cost, passively managed ETFs that emphasize broad market exposure and long-term investing. The company operates 175 ETFs across diverse fund families including Index, Bond, Equity, Dividend, Income, International, Factor, and ESG strategies, serving investors with various goals from core portfolio building to specialized income generation. Notable for its scale and popular tickers like VB (total U.S. small-cap), BND (total bond market), and VBIAX (international bonds), Vanguard focuses on providing comprehensive, index-based investment solutions with an emphasis on cost efficiency and accessibility.
See our curated list of related YouTube videos on VFH.
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 XLF.
Projections assume the current yield and share price remain constant. Actual results will vary.
Total returns
VFH has outpaced XLF over the trailing twelve months, posting a 9.15% total return against 8.57%. The picture flips over 10 years, though — XLF has compounded at 13.55% a year, ahead of VFH at 13.34%. Figures are total returns: price change plus every distribution reinvested.
Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of July 14, 2026. YTD and 1Y are cumulative; longer windows 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.
Quick verdict
VFH (Vanguard Financials ETF) and XLF (State Street Financial Select Sector SPDR ETF) are both quarterly-pay dividend ETFs, but they take different approaches.
VFH offers the higher yield at 2.48% vs 1.33% for XLF. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.
XLF is cheaper with an expense ratio of 0.09% compared to 0.10%.
They track different benchmarks: VFH is linked to MSCI US Investable Market Financials 25/50 Index while XLF tracks Financial Select Sector Index, which means their performance drivers differ.
XLF is the larger fund by assets ($49.5B), which generally means tighter spreads and better liquidity.
Who should choose each?
Choose VFH
Vanguard Financials ETF
Want higher current income — VFH yields 2.48% vs 1.33% for XLF.
Want broad equity exposure.
Choose XLF
State Street Financial Select Sector SPDR ETF
Want broad equity exposure.
Want to keep costs low — a 0.09% expense ratio vs 0.10% for VFH.
Not sure? Use the income calculator and snapshot above to weigh these trade-offs against your own goals.
Deep dive
Yield & income
On a $10,000 investment, VFH would generate roughly $20.67/month, while XLF would produce $11.08/month, at current distribution rates. Both pay quarterly distributions.
VFH yield2.48%
XLF yield1.33%
Monthly diff on $10K$9.58
Cost & efficiency
Over 10 years on $10,000, VFH would cost approximately $100 in fees vs $90 for XLF (simplified, not compounded). The $10.00 difference may be offset by yield or performance.
VFH ER0.10%
XLF ER0.09%
Strategy & risk
VFH tracks MSCI US Investable Market Financials 25/50 Index, while XLF tracks Financial Select Sector Index with an index approach. Beta is 0.83 for VFH and 0.75 for XLF, indicating XLF is less volatile relative to the market.
VFH beta0.83
XLF beta0.75
Fund details
VFH is managed by Vanguard (launched 01/26/2004) with $12.3B in assets. XLF is managed by State Street (launched 12/16/1998) with $49.5B in assets.
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Frequently asked questions
Is VFH or XLF better for dividend income?
It depends on your goals. VFH 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 VFH and XLF?
VFH (Vanguard Financials ETF) tracks MSCI US Investable Market Financials 25/50 Index, while XLF (State Street Financial Select Sector SPDR ETF) tracks Financial Select Sector Index with an index approach. They are issued by Vanguard and State Street respectively.
Can I hold both VFH and XLF?
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.
Which has lower fees, VFH or XLF?
VFH has an expense ratio of 0.10% while XLF charges 0.09%. Lower fees mean more of your investment returns stay in your pocket over time.
How much income does $10,000 in VFH vs XLF generate?
At current rates, $10,000 in VFH would generate roughly $20.67 per month ($248.00 annually). The same in XLF would produce about $11.08 per month ($133.00 annually).
Which has performed better historically, VFH or XLF?
VFH has outpaced XLF over the trailing twelve months, posting a 9.15% total return against 8.57%. The picture flips over 10 years, though — XLF has compounded at 13.55% a year, ahead of VFH at 13.34%. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.
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