XLE vs VDE Stock Comparison: AI Score, Valuation, Performance and Upside
XLE and VDE provide nearly identical energy sector exposure at nearly identical cost, but VDE is broader (110 holdings vs XLE's 20–25) and includes mid and small-cap energy companies that XLE excludes through its S&P 500 filter. In practice, the two ETFs are highly correlated because both are dominated by ExxonMobil and Chevron, but VDE gives slightly more exposure to oil price upside through smaller E&P companies.
XLE vs VDE is a choice between the most liquid megacap-only energy ETF and a slightly broader energy sector fund — in most oil price environments they track nearly identically, but VDE provides more small-cap E&P upside in commodity bull markets while XLE offers tighter spreads for trading.
XLE holds the edge across 4 of 5 key metrics in this comparison. VDE has delivered stronger 1-year price return (+26.27% vs +26.01% for XLE).
- →prefer the most liquid energy ETF with the tightest bid-ask spreads for tactical trading
- →value simplicity in a concentrated megacap energy ETF focused on integrated oil majors with dividends
- →want energy sector exposure with S&P 500 membership quality filter ensuring financial stability
- →are comfortable with ExxonMobil and Chevron representing nearly half the fund's assets
- →prefer broader energy sector coverage including smaller E&P and oil services companies beyond S&P 500 megacaps
- →value Vanguard's ownership structure and long-term fund management approach
- →want slightly more sensitivity to oil price upside through small-cap E&P company inclusion
- →are comfortable with the same cost (0.10% vs 0.09%) for meaningfully broader sector coverage
| Metric | XLE | VDE |
|---|---|---|
| ETF score | 74.0 | 65.0 |
| Latest close | $53.77 | $151.82 |
| 1M return | -12.27% | -12.37% |
| 6M return | +21.89% | +22.27% |
| 1Y return | +26.01% | +26.27% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | XLE | VDE |
|---|---|---|
| 1Y ago | $13.01K (+30.1%) started 2025-06-18 | $13.01K (+30.1%) started 2025-06-18 |
| 5Y ago | $30.18K (+201.8%) started 2021-06-18 | $29.83K (+198.3%) started 2021-06-18 |
| 10Y ago | $38.7K (+287.0%) started 2016-06-20 | $34.17K (+241.7%) started 2016-06-20 |
Hypothetical — past performance does not guarantee future results.
| Metric | XLE | VDE |
|---|---|---|
| Expense ratio | 0.08% | 0.09% |
| Total assets (AUM) | $38.67B | $11.78B |
| Dividend yield | 2.65% | 2.47% |
| Trailing P/E | 20.09 | 19.71 |
| Beta | 0.46 | 0.48 |
| 52-week change | 26.01% | 26.27% |
| Metric | XLE | VDE |
|---|---|---|
| 1Y return | +26.01% | +26.27% |
| 6M return | +21.89% | +22.27% |
| 1M return | -12.27% | -12.37% |
| 1Y Sharpe ratio | 1.00 | 1.01 |
| Beta | 0.46 | 0.48 |
| Dividend yield | 2.65% | 2.47% |
| 5Y CAGR | +19.82% | +19.76% |
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | XLE | VDE |
|---|---|---|---|
| 1Y | Growth | +26.01% | +26.27% |
| CAGR | +26.03% | +26.29% | |
| Sharpe ratio | 1.00 | 1.01 | |
| Max drawdown | 14.05% | 14.20% | |
| Max daily drop | 4.12% | 4.02% | |
| Max wkly drop | 7.02% | 7.16% | |
| 5Y | Growth | +146.97% | +146.27% |
| CAGR | +19.82% | +19.76% | |
| Sharpe ratio | 0.66 | 0.65 | |
| Max drawdown | 26.04% | 26.58% | |
| Max daily drop | 9.20% | 9.07% | |
| Max wkly drop | 18.68% | 18.78% | |
| 10Y | Growth | +137.54% | +126.59% |
| CAGR | +9.04% | +8.53% | |
| Sharpe ratio | 0.29 | 0.27 | |
| Max drawdown | 66.81% | 69.29% | |
| Max daily drop | 20.14% | 19.83% | |
| Max wkly drop | 34.55% | 35.20% |
| Category | XLE | VDE |
|---|---|---|
| Fund name | State Street Energy Select Sector SPDR ETF | Vanguard Energy Index Fund ETF Shares |
| Type | ETF | ETF |
| Expense ratio | 0.08% | 0.09% |
| Total assets (AUM) | $38.67B | $11.78B |
| Dividend yield | 2.65% | 2.47% |
- →0.09% expense ratio is one of the lowest in sector ETFs
- →S&P 500 universe filter ensures holdings are large, financially stable, dividend-paying energy companies
- →High daily trading volume and tight bid-ask spreads make it the most liquid energy ETF for tactical trading
- →Broader coverage (110 holdings) includes smaller E&P companies, oil services, and midstream names absent from XLE
- →0.10% expense ratio is virtually equal to XLE, with broader diversification at the same cost
- →Vanguard ownership structure and brand provide confidence in long-term fund management without conflicts of interest
- →Top 2 holdings (ExxonMobil and Chevron) can represent 40–50% of assets, creating extreme concentration
- →Exclusion of smaller energy companies, MLPs, and midstream companies limits sector breadth versus VDE
- →Energy sector performance is heavily correlated to crude oil price, and XLF provides no diversification against oil price risk
- →Despite broader coverage, ExxonMobil and Chevron still dominate VDE due to cap-weighting, limiting effective diversification vs XLE
- →Smaller energy company holdings increase exposure to high-cost producers that can be decimated by low oil prices
- →Slightly lower daily trading volume and wider bid-ask spreads than XLE in some market conditions
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