Updated 14 October 2026. Portfolio comparisons use 30 June 2026 issuer factsheets; performance uses a common ending date of 5 October 2026.
VGT and XLK are two ways to add US technology stocks to a portfolio. They share many familiar companies, but they do not give those companies the same weights.
VGT covers US information technology companies across large, medium and small sizes. XLK focuses on the information technology companies within the S&P 500. The decision is mainly about which investment universe you want, rather than which fund recently came first.
VGT vs XLK at a glance
| Feature | VGT | XLK |
|---|---|---|
| Fund name | Vanguard Information Technology ETF | State Street Technology Select Sector SPDR ETF |
| Benchmark | MSCI US Investable Market Information Technology 25/50 Index | Technology Select Sector Index |
| Investment universe | US information technology across company sizes | Information technology within the S&P 500 |
| Management | Passive index tracking | Passive index tracking |
| Annual expense ratio | 0.09% | 0.08% |
| Inception | 26 January 2004 | 16 December 1998 |
| Reported stocks / holdings | 321 | 74 |
| Dividend schedule | Quarterly | Quarterly |
VGT offers access to a wider set of companies. XLK’s S&P 500 membership requirement makes its portfolio more selective. However, both can be dominated by very large companies: owning more stocks does not necessarily spread your money evenly.
Both use formal information technology classifications. They are not designed to own every internet-based business that people casually call a “tech company”. If you want a different mix, the VGT vs QQQ comparison explains the distinction.
Fees: XLK is slightly cheaper
| Investment value | VGT at 0.09% | XLK at 0.08% | XLK’s annual saving |
|---|---|---|---|
| US$10,000 | US$9 | US$8 | US$1 |
| US$50,000 | US$45 | US$40 | US$5 |
| US$100,000 | US$90 | US$80 | US$10 |
The difference is just one basis point, or 0.01 percentage point. It is worth knowing, but it is unlikely to be the most important reason to choose one fund. Their stock weights can have a much greater effect on results. Fund expenses are deducted from assets rather than billed separately to you.
Top 10 holdings on the same date
| Rank | VGT company | Weight | XLK company | Weight |
|---|---|---|---|---|
| 1 | NVIDIA | 16.2% | NVIDIA | 12.63% |
| 2 | Apple | 14.4% | Apple | 11.08% |
| 3 | Microsoft | 8.3% | Microsoft | 7.22% |
| 4 | Micron Technology | 5.1% | Advanced Micro Devices | 4.71% |
| 5 | Broadcom | 3.9% | Micron Technology | 4.67% |
| 6 | Advanced Micro Devices | 3.7% | Broadcom | 4.66% |
| 7 | Intel | 2.4% | Intel | 4.20% |
| 8 | Applied Materials | 2.3% | Applied Materials | 3.65% |
| 9 | Lam Research | 2.2% | Lam Research | 3.45% |
| 10 | Cisco Systems | 1.8% | Cisco Systems | 2.95% |
| Top 10 total | — | 60.1% | — | 59.22% |
The top ten companies are the same in these snapshots, although their rankings and weights differ. VGT has a wider universe, yet more of its assets are in its top ten at this date. That is why the number of holdings alone is a poor measure of diversification.
Buying both would still leave you heavily exposed to shared technology businesses. VGT does not literally contain shares of XLK: each ETF holds its own portfolio. Their overlap can change as companies enter or leave the indexes and weights are adjusted.
Industry exposure within technology
| Technology industry | VGT | XLK |
|---|---|---|
| Semiconductors and equipment | 46.4% | 48.82% |
| Software | 21.1% | 20.39% |
| Hardware, storage and peripherals | 19.1% | 17.64% |
| Communications equipment | 4.2% | 5.54% |
| Electronic equipment, instruments and components | 5.1% | 4.94% |
| IT services | 3.4% | 2.66% |
| Other / unallocated to the groups above | 0.7% | Not separately shown |
For VGT, the semiconductor group combines chip makers with semiconductor equipment suppliers. Software combines systems and application software. Electronic equipment combines components, instruments and manufacturing services; IT services combines consulting with internet services and infrastructure.
The comparison shows how strongly both depend on the chip industry. Owning several technology industries helps spread company-specific risk, but it does not remove the risk of a broad sector downturn.
Performance over matching periods
The following figures use the same ending date for both funds. Multi-year returns are annualized: they show the compounded average per year, rather than the total gain over the period.
| Period ending 5 October 2026 | VGT | XLK |
|---|---|---|
| 2026 year to date | 37.59% | 40.07% |
| 1 year | 37.38% | 41.87% |
| 3 years, annualized | 36.18% | 35.36% |
| 5 years, annualized | 21.52% | 22.66% |
| 10 years, annualized | 25.07% | 25.04% |
VGT led over three years, XLK led over five, and their ten-year results were very close. The ranking changes with the measurement period. These figures do not establish a permanent winner.
What would US$10,000 have grown to?
| Holding period ending 5 October 2026 | VGT | XLK |
|---|---|---|
| 3 years | US$25,256 | US$24,799 |
| 5 years | US$26,501 | US$27,766 |
| 10 years | US$93,650 | US$93,426 |
Each row assumes one US$10,000 investment at the start, with no extra deposits or withdrawals. Personal taxes, brokerage charges and currency conversion costs are excluded. A Singapore investor’s result measured in SGD also depends on USD/SGD movements. These are historical illustrations, not forecasts.
Calendar-year returns show the difficult periods
| Year | VGT | XLK |
|---|---|---|
| 2020 | 46.04% | 43.62% |
| 2021 | 30.45% | 34.74% |
| 2022 | −29.70% | −27.73% |
| 2023 | 52.66% | 56.02% |
| 2024 | 29.30% | 21.63% |
| 2025 | 21.77% | 24.61% |
Both suffered large losses in 2022. A strong long-term average does not make the journey smooth, and similar past losses do not mean the funds will behave identically in the next downturn.
Technology companies can be hurt by weaker demand, competition, regulation or earnings that disappoint high expectations. Even a successful business can be a poor investment if its share price already assumes too much future success.
Which ETF fits your portfolio?
| Your priority | What to consider |
|---|---|
| Technology exposure beyond the S&P 500 | VGT includes a wider range of company sizes. |
| The technology segment of the S&P 500 | XLK directly targets that universe. |
| Lowest ongoing fund fee | XLK is cheaper by 0.01 percentage point. |
| Less dependence on individual companies | Compare current weights; a larger holding count is not enough. |
| Diversification away from technology | Neither achieves this. Consider your overall portfolio exposure. |
| Already own one of the funds | A small fee difference alone may not justify trading costs or taxes where applicable. |
VGT is a reasonable choice when you deliberately want broader company-size coverage within technology. XLK suits an investor who wants to focus on S&P 500 technology companies. For most beginners, deciding how much to allocate to one sector matters more than choosing between these two closely related funds.
Treat either as a deliberate sector allocation. If you already own a broad US index fund, check how much additional exposure you are adding to companies you already hold. Money needed soon should not depend on the technology sector recovering on a particular schedule.
Singapore-based investors should also consider domicile and tax treatment alongside fees. My S&P 500 ETF guide discusses those considerations.
This article is for general information and is not personal financial advice. Investments can lose value, and past performance does not guarantee future results.
