Why does XLF include Visa and Mastercard?

GICS sector classification places Visa, Mastercard, and PayPal in the Financials sector as non-bank financial companies. These payments networks provide some of the highest-return businesses in the financial sector and are significant XLF weightings — investors should understand XLF includes both traditional banks and high-multiple payments companies.

How do ECB vs Fed policy differences affect these ETFs?

The ECB (European Central Bank) and Fed set rates independently for their respective economies. When the ECB raised rates from negative territory, European bank net interest margins improved significantly, benefiting EUFN. When the Fed raises rates, U.S. bank lending spreads improve, benefiting XLF's banking components. Rate cycle timing differences can create periods of relative outperformance between EUFN and XLF.

Why are European banks' valuations lower than U.S. banks?

Lower valuations reflect lower expected returns on equity (ROE). European banks have structurally lower ROE due to more intense competition, heavier regulation (Basel III requirements), more bad loans from historical crises (2010-2012 sovereign debt crisis), and fragmented markets. Markets price European banks at lower price-to-book multiples reflecting these lower profitability expectations.

brimindinvest.com / compare / eufn-vs-xlfLIVE

EUFN

iShares MSCI Europe Financials ETF · Financials - European Financial Sector / ETF

$38.73

+6.96% this month

VERSUS

⟷

COMPARE

XLF

Financial Select Sector SPDR Fund · Financials - U.S. Financial Sector / ETF

$53.57

+4.83% this month

Scoreboard verdict

Across expense ratio, momentum, yield, fund size, risk

EUFN

3

XLF

2

EUFN LEADS 3/5

Comparison scoreboard

EUFN LEADS 3/5

Exp. Ratio

EUFN 0.49%

XLF ✓0.08%

1Y Return

EUFN ✓+32.43%

XLF +8.32%

Div. Yield

EUFN ✓3.43%

XLF 1.54%

AUM

EUFN $3.64B

XLF ✓$49.42B

Beta

EUFN ✓0.80

XLF 0.88

Metrics last refreshed: 6/20/2026

Quick take

EUFN vs XLF Stock Comparison: AI Score, Valuation, Performance and Upside

EUFN provides European bank and insurance company exposure often trading at lower valuations with higher dividends, while XLF gives U.S. financial sector exposure including the dominant U.S. banks and payments companies (Visa, Mastercard, Berkshire). U.S. banks have dramatically outperformed European banks on profitability metrics over the past decade.

EUFN vs XLF is the geographic financial sector comparison — European bank value-and-dividend versus U.S. financial sector quality-and-growth, reflecting very different regulatory, profitability, and business model environments.

Live analysis · updated 6/20/2026

EUFN holds the edge across 3 of 5 key metrics in this comparison. EUFN has delivered stronger 1-year price return (+32.43% vs +8.32% for XLF).

Normalized 1Y performance

EUFN

XLF

Recent returns

EUFN

XLF

Who should consider this stock?

EUFN may suit investors who:

→Want European financial sector exposure as a value-oriented, higher-dividend alternative to U.S. banks
→See European bank valuations as offering contrarian value given historically low earnings multiples
→Are making a tactical bet on European economic recovery and ECB rate normalization benefiting European bank profitability

XLF may suit investors who:

→Want U.S. financial sector exposure including the world's largest and most profitable banks alongside payments and insurance
→Value U.S. financial company profitability and returns on equity significantly above European counterparts
→Want liquid, core U.S. financial sector exposure including Visa, Mastercard, and Berkshire Hathaway alongside major banks

Performance & AI score

Metric	EUFN	XLF
ETF score	55.0	61.0
Latest close	$38.73	$53.57
1M return	+6.96%	+4.83%
6M return	+10.31%	-1.09%
1Y return	+32.43%	+8.32%

$10,000 invested — hypothetical growth (dividends reinvested)

How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?

Period	EUFN	XLF
1Y ago	$13.84K (+38.4%) started 2025-06-18	$11K (+10.0%) started 2025-06-18
5Y ago	$32.75K (+227.5%) started 2021-06-18	$18.16K (+81.6%) started 2021-06-18
10Y ago	$59.37K (+493.7%) started 2016-06-20	$42.44K (+324.4%) started 2016-06-20

Hypothetical — past performance does not guarantee future results.

Fund characteristics

Metric	EUFN	XLF
Expense ratio	0.49%	0.08%
Total assets (AUM)	$3.64B	$49.42B
Dividend yield	3.43%	1.54%
Trailing P/E	12.04	16.90
Beta	0.80	0.88
52-week change	32.43%	8.32%

Risk & fund metrics

Metric	EUFN	XLF
1Y return	+32.43%	+8.32%
6M return	+10.31%	-1.09%
1M return	+6.96%	+4.83%
1Y Sharpe ratio	1.29	0.31
Beta	0.80	0.88
Dividend yield	3.43%	1.54%
5Y CAGR	+20.15%	+10.66%

Drawdown & downside risk

Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.

1Y risk snapshot

EUFN max drawdown14.77%

XLF max drawdown14.79%

EUFN max wkly drop8.23%

XLF max wkly drop4.81%

5Y risk snapshot

EUFN max drawdown35.16%

XLF max drawdown25.81%

EUFN max wkly drop15.52%

XLF max wkly drop12.19%

10Y risk snapshot

EUFN max drawdown53.26%

XLF max drawdown42.86%

EUFN max wkly drop25.20%

XLF max wkly drop22.99%

Performance metrics by period

Period	Metric	EUFN	XLF
1Y	Growth	+32.43%	+8.32%
	CAGR	+32.45%	+8.32%
	Sharpe ratio	1.29	0.31
	Max drawdown	14.77%	14.79%
	Max daily drop	3.65%	3.35%
	Max wkly drop	8.23%	4.81%
5Y	Growth	+150.40%	+65.90%
	CAGR	+20.15%	+10.66%
	Sharpe ratio	0.75	0.40
	Max drawdown	35.16%	25.81%
	Max daily drop	8.34%	7.32%
	Max wkly drop	15.52%	12.19%
10Y	Growth	+237.07%	+247.74%
	CAGR	+12.93%	+13.28%
	Sharpe ratio	0.44	0.47
	Max drawdown	53.26%	42.86%
	Max daily drop	16.56%	13.71%
	Max wkly drop	25.20%	22.99%

Fund overview

Category	EUFN	XLF
Fund name	iShares MSCI Europe Financials ETF	State Street Financial Select Sector SPDR ETF
Type	ETF	ETF
Expense ratio	0.49%	0.08%
Total assets (AUM)	$3.64B	$49.42B
Dividend yield	3.43%	1.54%

EUFN strengths

→European financial companies (particularly banks) often trade at lower valuations than U.S. counterparts, providing potentially cheaper entry into financial sector exposure
→High dividend yields from European banks and insurers — European financial companies have historically returned more capital through dividends than U.S. peers
→Exposure to diverse European financial markets across UK, France, Germany, Switzerland, Italy, Netherlands, and Spain

XLF strengths

→Includes not only banks but also Visa, Mastercard, and Berkshire Hathaway — providing broader financial sector exposure beyond pure banking
→U.S. financial companies (particularly JPMorgan) have generated significantly higher returns on equity than European banks over the past decade
→XLF is one of the most liquid sector ETFs with tight bid-ask spreads and high daily trading volume

Risks to watch — EUFN

→European banks face structural challenges including below-average return on equity relative to U.S. banks, legacy bad loan portfolios, and regulatory complexity across multiple jurisdictions
→Currency risk — EUFN is not currency-hedged, so EUR/GBP/CHF vs USD exchange rates affect returns for USD-based investors
→European economic health and ECB policy direction significantly affect European bank earnings and asset quality

Risks to watch — XLF

→Berkshire Hathaway and Visa/Mastercard (non-bank financial) are large XLF weightings and may dilute pure banking cycle exposure
→U.S. bank valuations are generally higher than European banks, reflecting higher profitability but also higher multiples
→Federal Reserve rate decisions and loan loss provisions significantly affect U.S. bank earnings in XLF's banking components

Frequently asked questions

U.S. banks (JPMorgan, Goldman Sachs, Bank of America) have significantly higher returns on equity, more profitable retail banking franchises, less regulatory fragmentation, and stronger investment banking businesses. European banks face structural challenges including sovereign debt exposure, cross-border regulatory complexity, negative-rate-era legacy issues, and markets more fragmented by national borders than the unified U.S. market.

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+1.1%HOLD

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