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GLD vs. XLV: What’s The Difference?

The SPDR Gold Shares (GLD) and the Health Care Select Sector SPDR Fund (XLV) are both among the Top 100 ETFs. GLD is a SPDR State Street Global Advisors N/A fund and XLV is a SPDR State Street Global Advisors Health fund. So, what’s the difference between GLD and XLV? And which fund is better?

The expense ratio of GLD is 0.28 percentage points higher than XLV’s (0.4% vs. 0.12%). GLD also has a lower exposure to the technology sector and a higher standard deviation. Overall, GLD has provided lower returns than XLV over the past ten years.

In this article, we’ll compare GLD vs. XLV. We’ll look at industry exposure and fund composition, as well as at their performance and holdings. Moreover, I’ll also discuss GLD’s and XLV’s risk metrics, annual returns, and portfolio growth and examine how these affect their overall returns.

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Summary

GLDXLV
NameSPDR Gold SharesHealth Care Select Sector SPDR Fund
CategoryN/AHealth
IssuerSPDR State Street Global AdvisorsSPDR State Street Global Advisors
AUM59.26B27.88B
Avg. Return5.81%15.02%
Div. Yield0.0%1.4%
Expense Ratio0.4%0.12%

The SPDR Gold Shares (GLD) is a N/A fund that is issued by SPDR State Street Global Advisors. It currently has 59.26B total assets under management and has yielded an average annual return of 5.81% over the past 10 years. The fund has a dividend yield of 0.0% with an expense ratio of 0.4%.

The Health Care Select Sector SPDR Fund (XLV) is a Health fund that is issued by SPDR State Street Global Advisors. It currently has 27.88B total assets under management and has yielded an average annual return of 15.02% over the past 10 years. The fund has a dividend yield of 1.4% with an expense ratio of 0.12%.

GLD’s dividend yield is 1.40% lower than that of XLV (0.0% vs. 1.4%). Also, GLD yielded on average 9.22% less per year over the past decade (5.81% vs. 15.02%). The expense ratio of GLD is 0.28 percentage points higher than XLV’s (0.4% vs. 0.12%).

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Fund Composition

Industry Exposure

GLD vs. XLV - Industry Exposure

GLDXLV
Technology0.0%0.0%
Industrials0.0%0.0%
Energy0.0%0.0%
Communication Services0.0%0.0%
Utilities0.0%0.0%
Healthcare0.0%100.0%
Consumer Defensive0.0%0.0%
Real Estate0.0%0.0%
Financial Services0.0%0.0%
Consumer Cyclical0.0%0.0%
Basic Materials0.0%0.0%

The SPDR Gold Shares (GLD) has the most exposure to the Technology sector at 0.0%. This is followed by Industrials and Energy at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.

GLD’s mid-section with moderate exposure is comprised of Consumer Defensive, Healthcare, Utilities, Communication Services, and Energy stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.

The Health Care Select Sector SPDR Fund (XLV) has the most exposure to the Healthcare sector at 100.0%. This is followed by Technology and Industrials at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.

XLV’s mid-section with moderate exposure is comprised of Consumer Defensive, Utilities, Communication Services, Energy, and Industrials stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.

GLD is 0.00% less exposed to the Technology sector than XLV (0.0% vs 0.0%). GLD’s exposure to Industrials and Energy stocks is 0.00% lower and 0.00% lower respectively (0.0% vs. 0.0% and 0.0% vs. 0.0%). In total, Consumer Cyclical, Financial Services, and Real Estate also make up 0.00% less of the fund’s holdings compared to XLV (0.00% vs. 0.00%).

Holdings

GLD - Holdings

GLD HoldingsWeight
Gold Trust100.0%
N/A0%
N/A0%
N/A0%
N/A0%
N/A0%
N/A0%
N/A0%
N/A0%
N/A0%

GLD’s Top Holdings are Gold Trust, N/A, N/A, N/A, and N/A at 100.0%, 0%, 0%, 0%, and 0%.

N/A (0%), N/A (0%), and N/A (0%) have a slightly smaller but still significant weight. N/A and N/A are also represented in the GLD’s holdings at 0% and 0%.

XLV - Holdings

XLV HoldingsWeight
Johnson & Johnson9.19%
UnitedHealth Group Inc8.01%
Pfizer Inc4.64%
Abbott Laboratories4.36%
AbbVie Inc4.21%
Thermo Fisher Scientific Inc4.2%
Merck & Co Inc4.17%
Eli Lilly and Co3.87%
Danaher Corp3.61%
Medtronic PLC3.54%

XLV’s Top Holdings are Johnson & Johnson, UnitedHealth Group Inc, Pfizer Inc, Abbott Laboratories, and AbbVie Inc at 9.19%, 8.01%, 4.64%, 4.36%, and 4.21%.

Thermo Fisher Scientific Inc (4.2%), Merck & Co Inc (4.17%), and Eli Lilly and Co (3.87%) have a slightly smaller but still significant weight. Danaher Corp and Medtronic PLC are also represented in the XLV’s holdings at 3.61% and 3.54%.

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Risk Analysis

GLDXLV
Mean Return0.211.27
R-squared16.2158.19
Std. Deviation16.5812.94
Alpha3.917.75
Beta0.480.7
Sharpe Ratio0.121.13
Treynor Ratio1.2121.1

The SPDR Gold Shares (GLD) has a Mean Return of 0.21 with a Beta of 0.48 and a Treynor Ratio of 1.21. Its Alpha is 3.91 while GLD’s Standard Deviation is 16.58. Furthermore, the fund has a R-squared of 16.21 and a Sharpe Ratio of 0.12.

The Health Care Select Sector SPDR Fund (XLV) has a Standard Deviation of 12.94 with a R-squared of 58.19 and a Beta of 0.7. Its Treynor Ratio is 21.1 while XLV’s Sharpe Ratio is 1.13. Furthermore, the fund has a Alpha of 7.75 and a Mean Return of 1.27.

GLD’s Mean Return is 1.06 points lower than that of XLV and its R-squared is 41.98 points lower. With a Standard Deviation of 16.58, GLD is slightly more volatile than XLV. The Alpha and Beta of GLD are 3.84 points lower and 0.22 points lower than XLV’s Alpha and Beta.

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Performance

Annual Returns

GLD vs. XLV - Annual Returns

YearGLDXLV
202023.68%13.33%
201918.36%20.63%
2018-1.54%6.3%
201711.41%21.7%
20168.69%-2.83%
2015-11.78%6.82%
2014-0.58%25.17%
2013-28.09%41.24%
20125.26%17.56%
201111.2%12.44%
201027.25%2.91%

GLD had its best year in 2010 with an annual return of 27.25%. GLD’s worst year over the past decade yielded -28.09% and occurred in 2013. In most years the SPDR Gold Shares provided moderate returns such as in 2012, 2016, and 2011 where annual returns amounted to 5.26%, 8.69%, and 11.2% respectively.

The year 2013 was the strongest year for XLV, returning 41.24% on an annual basis. The poorest year for XLV in the last ten years was 2016, with a yield of -2.83%. Most years the Health Care Select Sector SPDR Fund has given investors modest returns, such as in 2011, 2020, and 2012, when gains were 12.44%, 13.33%, and 17.56% respectively.

Portfolio Growth

GLD vs. XLV - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
GLD$10,000$16,3955.81%
XLV$10,000$44,14715.02%

A $10,000 investment in GLD would have resulted in a final balance of $16,395. This is a profit of $6,395 over 11 years and amounts to a compound annual growth rate (CAGR) of 5.81%.

With a $10,000 investment in XLV, the end total would have been $44,147. This equates to a $34,147 profit over 11 years and a compound annual growth rate (CAGR) of 15.02%.

GLD’s CAGR is 9.22 percentage points lower than that of XLV and as a result, would have yielded $27,752 less on a $10,000 investment. Thus, GLD performed worse than XLV by 9.22% annually.


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