XLRE vs VNQ Stock Comparison: AI Score, Valuation, Performance and Upside
XLRE and VNQ are both U.S. REIT ETFs but with different universes: XLRE is limited to the 30 largest S&P 500 REITs, while VNQ covers 160+ REITs across all market caps. XLRE offers lower cost and a concentrated large-cap REIT exposure for sector rotation strategies; VNQ offers broader, more comprehensive real estate sector coverage including mid-cap names.
XLRE vs VNQ is a large-cap REIT selection (XLRE) versus broad REIT market coverage (VNQ) choice — investors using sector rotation frameworks often prefer XLRE's integration with the SPDR Select Sector family, while passive real estate allocators prefer VNQ's broader coverage.
VNQ holds the edge across 4 of 5 key metrics in this comparison. VNQ has delivered stronger 1-year price return (+10.63% vs +10.46% for XLRE).
- prefer a concentrated large-cap REIT ETF that integrates with the State Street Select Sector SPDR framework for sector rotation
- value S&P 500 membership quality filter ensuring the largest and most financially stable REITs
- want real estate sector exposure at lower cost (0.09%) with a focus on blue-chip REITs like Prologis and Equinix
- are comfortable with only 30 holdings and less diversification than broader REIT ETFs like VNQ
- prefer broader U.S. REIT sector coverage including mid-cap and smaller REITs beyond S&P 500 members
- value the largest REIT ETF AUM ($35B+) for superior secondary market liquidity
- want comprehensive real estate sector diversification across all subsectors and REIT sizes
- are comfortable paying 0.13% expense ratio for meaningfully broader coverage than XLRE's 30-stock concentrated portfolio
| Metric | XLRE | VNQ |
|---|---|---|
| ETF scorei | 24.9 | 24.8 |
| Latest closei | $43.64 | $95.06 |
| 1M returni | +6.93% | +6.21% |
| 3M returni | -2.60% | -3.22% |
| 6M returni | +0.71% | +1.33% |
| 1Y returni | +10.46% | +10.63% |
The ETF score weights long-term returns and risk-adjusted performance most heavily, but still rewards low expense ratios, larger fund size, and broader diversification — so it can favor low-cost, broad, mega-cap funds over smaller thematic or actively-managed funds even when the latter have delivered stronger returns.
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | XLRE | VNQ |
|---|---|---|
| 1Y ago | $11.46K (+14.6%) started 2025-11-03 | $11.51K (+15.1%) started 2025-11-03 |
| 5Y ago | $12.78K (+27.8%) started 2021-11-03 | $12.94K (+29.4%) started 2021-11-03 |
| 10Y ago | $31.18K (+211.8%) started 2016-11-03 | $29.39K (+193.9%) started 2016-11-03 |
Hypothetical — past performance does not guarantee future results.
| Metric | XLRE | VNQ |
|---|---|---|
| Expense ratioi | 0.08% | 0.13% |
| Total assets (AUM)i | $7.65B | $66.42B |
| Dividend yieldi | 3.53% | 3.80% |
| Trailing P/Ei | 31.17 | 30.07 |
| Betai | 0.95 | 0.96 |
| 52-week change | 10.46% | 10.63% |
| Metric | XLRE | VNQ |
|---|---|---|
| 1Y returni | +10.46% | +10.63% |
| 6M returni | +0.71% | +1.33% |
| 3M returni | -2.60% | -3.22% |
| 1M returni | +6.93% | +6.21% |
| 1Y Sharpe ratio | 0.47 | 0.49 |
| Betai | 0.95 | 0.96 |
| Dividend yieldi | 3.53% | 3.80% |
| 5Y CAGR | +1.23% | +0.89% |
Over the past year, XLRE and VNQ have moved strongly in the same direction (correlation of 0.99), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | XLRE | VNQ |
|---|---|---|---|
| 1Y | Growthi | +10.65% | +10.79% |
| CAGRi | +10.69% | +10.83% | |
| Volatilityi | 14.19% | 13.77% | |
| Sharpe ratioi | 0.47 | 0.49 | |
| Sortino ratioi | 0.68 | 0.72 | |
| Max drawdowni | 11.08% | 11.38% | |
| Current drawdowni | 4.35% | 5.02% | |
| Avg drawdowni | 2.84% | 2.89% | |
| Ulcer Indexi | 3.94% | 4.07% | |
| Max daily dropi | 3.17% | 3.10% | |
| Max wkly dropi | 5.05% | 4.81% | |
| 5Y | Growthi | +6.31% | +4.54% |
| CAGRi | +1.23% | +0.89% | |
| Volatilityi | 19.18% | 18.90% | |
| Sharpe ratioi | -0.07 | -0.10 | |
| Sortino ratioi | -0.10 | -0.13 | |
| Max drawdowni | 34.11% | 34.48% | |
| Current drawdowni | 4.35% | 5.02% | |
| Avg drawdowni | 14.25% | 14.71% | |
| Ulcer Indexi | 16.68% | 17.02% | |
| Max daily dropi | 4.82% | 5.00% | |
| Max wkly dropi | 12.01% | 12.07% | |
| 10Y | Growthi | +107.12% | +81.03% |
| CAGRi | +7.56% | +6.12% | |
| Volatilityi | 20.41% | 20.68% | |
| Sharpe ratioi | 0.24 | 0.18 | |
| Sortino ratioi | 0.33 | 0.24 | |
| Max drawdowni | 38.82% | 42.40% | |
| Current drawdowni | 4.35% | 5.02% | |
| Avg drawdowni | 9.56% | 10.22% | |
| Ulcer Indexi | 12.96% | 13.68% | |
| Max daily dropi | 16.00% | 17.73% | |
| Max wkly dropi | 23.08% | 24.91% |
| Category | XLRE | VNQ |
|---|---|---|
| Fund name | State Street Real Estate Select Sector SPDR ETF | Vanguard Real Estate Index Fund ETF Shares |
| Type | ETF | ETF |
| Expense ratioi | 0.08% | 0.13% |
| Total assets (AUM)i | $7.65B | $66.42B |
| Dividend yieldi | 3.53% | 3.80% |
- 0.09% expense ratio provides very low cost access to large-cap REIT sector exposure
- S&P 500 filter ensures holdings are among the most financially sound and liquid REITs in the market
- Commonly used in sector rotation strategies alongside other Select Sector SPDRs (XLF, XLK, XLE, etc.)
- 160+ holdings across all REIT subsectors and market caps provides much broader real estate sector coverage than XLRE
- Includes mid-cap and smaller REITs that can outperform in REIT bull markets and recovery cycles
- VNQ's larger AUM ($35B+) provides excellent secondary market liquidity relative to XLRE
- Only 30 holdings — far fewer than VNQ's 160+ — creates more concentration in a small number of mega-REITs
- S&P 500 filter excludes many mid-cap and smaller REITs that can drive significant returns in REIT bull markets
- Heavy weighting toward industrial and data center REITs (Prologis, Equinix, American Tower) gives XLRE different subsector tilts than VNQ
- 0.13% expense ratio is 4 basis points more than XLRE's 0.09%
- Broader inclusion of smaller REITs means more exposure to financially weaker companies that may cut dividends during stress periods
- Real estate as a sector is sensitive to interest rate changes regardless of which ETF is chosen
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