VFH vs XLF: Differences, Fees and Returns
XLF is cheaper: it charges 0.08% a year against 0.09% for VFH. That is €1 less a year per 10,000 invested; over a plan of 10,000 up front plus 200 a month for 30 years, the accumulated cost gap comes to about €708.
They do not track the same thing: VFH follows the MSCI US Investable Market Financials 25/50 Index and XLF the Financial Select Sector Index. Any difference in returns will come mainly from that exposure, not from the fee.
Over the last 10 years, XLF returned 13.28% a year against 13.07% for VFH. That is past performance and may not repeat.
Head-to-head comparison
| VFH | XLF | |
|---|---|---|
| Name | Vanguard Financials ETF | Financial Select Sector SPDR Fund |
| Provider | Vanguard | State Street |
| Index | MSCI US Investable Market Financials 25/50 Index | Financial Select Sector Index |
| TER | 0.09% | 0.08% |
| Type | ETF | ETF |
| Domicile | United States | United States |
| Dividends | Distributing | Distributing |
| Launch date | January 26, 2004 | December 16, 1998 |
| Fund size | $15B | $55B |
| ISIN | — | — |
| Available to EU retail investors | No | No |
| Tax-free switch (Spain) | No | No |
Historical returns: VFH vs XLF (Aug 2016 – Aug 2026)
10,000 invested in Aug 2016 would be worth $34,159 in VFH and $34,796 in XLF today.
| VFH | XLF | |
|---|---|---|
| Annualised return | 13.07% | 13.28% |
| Total return | 241.59% | 247.96% |
| Annual volatility | 19.88% | 19.36% |
| Maximum drawdown | -33.10% | -31.75% |
| Monthly correlation | 1 | |
Calendar-year returns
| Year | VFH | XLF |
|---|---|---|
| 2026* | 6.61% | 6.27% |
| 2025 | 14.91% | 14.89% |
| 2024 | 30.46% | 30.55% |
| 2023 | 14.15% | 12.02% |
| 2022 | -12.31% | -10.60% |
| 2021 | 35.19% | 34.82% |
| 2020 | -2.00% | -1.67% |
| 2019 | 31.57% | 31.88% |
| 2018 | -13.51% | -13.04% |
| 2017 | 19.98% | 22.00% |
* Current year, to Aug 2026.
Month-end closing prices adjusted for dividends and net of fund costs. Broker fees and taxes are not included. Past performance does not guarantee future results.