XLK vs XLE
Technology (XLK) vs Energy (XLE) — Growth-driven tech or commodity-linked energy?
Understanding XLK and XLE
XLK (Technology Select Sector SPDR) tracks the technology sector of the S&P 500, providing exposure to giants like Apple, Microsoft, and NVIDIA. With $87.7B in assets, it's the largest sector ETF and a pure play on American tech dominance.
XLE (Energy Select Sector SPDR) tracks the energy sector of the S&P 500, including oil majors like ExxonMobil and Chevron. With $37.9B in assets, XLE offers exposure to oil, gas, and energy equipment companies.
The key difference: XLK benefits from digital transformation and AI growth, while XLE is tied to oil prices and energy demand cycles. Over 10 years, XLK has returned +586.97% vs XLE's +177.71% — but energy can outperform during inflationary periods and commodity supercycles.
Head to Head
Compare XLK and XLE across key metrics that matter to sector investors: expense ratios, historical returns, volatility, and maximum drawdown.
| Metric | XLK | XLE | Winner |
|---|---|---|---|
| Expense Ratio | 0.08% | 0.08% | Tie |
| Total Assets | $87.7B | $37.9B | XLK |
| 1 Year Return | +33.10% | +26.62% | XLK |
| 5 Year Return | +113.78% | +181.12% | XLE |
| 10 Year Return | +586.97% | +177.71% | XLK |
| Volatility (3Y) | 17.1% | 18.9% | XLK |
| Max Drawdown | -80.5% | -64.0% | XLE |
Growth of $10,000
The table below shows what $10,000 invested at different points in time would be worth today. The chart visualizes long-term growth starting from the same inception date for both ETFs.
Monthly Returns Comparison
These heatmaps reveal the month-by-month performance patterns of each ETF. Green indicates positive returns, red indicates negative returns, with darker colors showing larger moves. Notice the cyclical patterns — XLE tends to be more volatile and commodity-driven, while XLK follows tech sentiment.
XLK Monthly Returns
XLE Monthly Returns
Key Differences
XLK (Technology Sector)
- • Tracks S&P 500 technology companies
- • Top holdings: Apple, Microsoft, NVIDIA
- • Benefits from AI, cloud, and digital trends
- • Growth-oriented with higher valuations
- • Less sensitive to commodity prices
XLE (Energy Sector)
- • Tracks S&P 500 energy companies
- • Top holdings: ExxonMobil, Chevron, ConocoPhillips
- • Tied to oil and natural gas prices
- • Higher dividend yield, value-oriented
- • Acts as inflation hedge
The Bottom Line
Choose XLK if you believe technology will continue to drive economic growth and want exposure to AI, cloud computing, and software leaders. Choose XLE if you want commodity exposure, higher dividends, or believe energy prices will rise due to supply constraints or inflation.
Frequently Asked Questions
What is the difference between XLK and XLE?
XLK tracks the technology sector of the S&P 500 (companies like Apple, Microsoft, NVIDIA), while XLE tracks the energy sector (ExxonMobil, Chevron, ConocoPhillips). XLK is growth-focused with tech exposure; XLE is value-focused with commodity exposure.
Which is better: XLK or XLE?
XLK has historically outperformed XLE over the long term due to tech sector growth. However, XLE can outperform during inflationary periods, oil price spikes, and value rotations. XLE also offers higher dividend yields.
Why is XLE so volatile?
XLE's volatility is tied to oil and natural gas prices, which are affected by geopolitical events, OPEC decisions, and economic cycles. Energy stocks can swing dramatically based on commodity price movements.
What are the expense ratios for XLK and XLE?
Both XLK and XLE have the same expense ratio of 0.08%. As SPDR sector ETFs from State Street, they share the same low-cost structure.
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Last updated: 3/15/2026