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GLD vs. XLY: What’s The Difference?

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

The expense ratio of GLD is 0.28 percentage points higher than XLY’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 XLY over the past ten years.

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

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Summary

GLDXLY
NameSPDR Gold SharesConsumer Discretionary Select Sector SPDR Fund
CategoryN/AConsumer Cyclical
IssuerSPDR State Street Global AdvisorsSPDR State Street Global Advisors
AUM59.26B20.21B
Avg. Return5.81%18.86%
Div. Yield0.0%0.63%
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 Consumer Discretionary Select Sector SPDR Fund (XLY) is a Consumer Cyclical fund that is issued by SPDR State Street Global Advisors. It currently has 20.21B total assets under management and has yielded an average annual return of 18.86% over the past 10 years. The fund has a dividend yield of 0.63% with an expense ratio of 0.12%.

GLD’s dividend yield is 0.63% lower than that of XLY (0.0% vs. 0.63%). Also, GLD yielded on average 13.06% less per year over the past decade (5.81% vs. 18.86%). The expense ratio of GLD is 0.28 percentage points higher than XLY’s (0.4% vs. 0.12%).

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Fund Composition

Industry Exposure

GLD vs. XLY - Industry Exposure

GLDXLY
Technology0.0%0.57%
Industrials0.0%0.0%
Energy0.0%0.0%
Communication Services0.0%0.0%
Utilities0.0%0.0%
Healthcare0.0%0.0%
Consumer Defensive0.0%5.34%
Real Estate0.0%0.0%
Financial Services0.0%0.0%
Consumer Cyclical0.0%94.1%
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 Consumer Discretionary Select Sector SPDR Fund (XLY) has the most exposure to the Consumer Cyclical sector at 94.1%. This is followed by Consumer Defensive and Technology at 5.34% and 0.57% respectively. Financial Services (0.0%), Real Estate (0.0%), and Healthcare (0.0%) only make up 0.00% of the fund’s total assets.

XLY’s mid-section with moderate exposure is comprised of Utilities, Communication Services, Energy, Industrials, and Technology stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.57%.

GLD is 0.57% less exposed to the Technology sector than XLY (0.0% vs 0.57%). 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 94.10% less of the fund’s holdings compared to XLY (0.00% vs. 94.10%).

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%.

XLY - Holdings

XLY HoldingsWeight
Amazon.com Inc22.9%
Tesla Inc13.5%
The Home Depot Inc8.74%
McDonald’s Corp4.5%
Nike Inc B4.45%
Lowe’s Companies Inc3.58%
Starbucks Corp3.44%
Target Corp3.12%
Booking Holdings Inc2.35%
TJX Companies Inc2.12%

XLY’s Top Holdings are Amazon.com Inc, Tesla Inc, The Home Depot Inc, McDonald’s Corp, and Nike Inc B at 22.9%, 13.5%, 8.74%, 4.5%, and 4.45%.

Lowe’s Companies Inc (3.58%), Starbucks Corp (3.44%), and Target Corp (3.12%) have a slightly smaller but still significant weight. Booking Holdings Inc and TJX Companies Inc are also represented in the XLY’s holdings at 2.35% and 2.12%.

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Risk Analysis

GLDXLY
Mean Return0.211.47
R-squared16.2180.84
Std. Deviation16.5815.97
Alpha3.916.96
Beta0.481.02
Sharpe Ratio0.121.06
Treynor Ratio1.2116.69

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

The Consumer Discretionary Select Sector SPDR Fund (XLY) has a Alpha of 6.96 with a Beta of 1.02 and a Treynor Ratio of 16.69. Its R-squared is 80.84 while XLY’s Sharpe Ratio is 1.06. Furthermore, the fund has a Mean Return of 1.47 and a Standard Deviation of 15.97.

GLD’s Mean Return is 1.26 points lower than that of XLY and its R-squared is 64.63 points lower. With a Standard Deviation of 16.58, GLD is slightly more volatile than XLY. The Alpha and Beta of GLD are 3.05 points lower and 0.54 points lower than XLY’s Alpha and Beta.

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Performance

Annual Returns

GLD vs. XLY - Annual Returns

YearGLDXLY
202023.68%29.66%
201918.36%28.43%
2018-1.54%1.66%
201711.41%22.77%
20168.69%5.87%
2015-11.78%9.93%
2014-0.58%9.49%
2013-28.09%42.74%
20125.26%23.6%
201111.2%5.98%
201027.25%27.36%

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 XLY, returning 42.74% on an annual basis. The poorest year for XLY in the last ten years was 2018, with a yield of 1.66%. Most years the Consumer Discretionary Select Sector SPDR Fund has given investors modest returns, such as in 2015, 2017, and 2012, when gains were 9.93%, 22.77%, and 23.6% respectively.

Portfolio Growth

GLD vs. XLY - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
GLD$10,000$16,3955.81%
XLY$10,000$63,06618.86%

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 XLY, the end total would have been $63,066. This equates to a $53,066 profit over 11 years and a compound annual growth rate (CAGR) of 18.86%.

GLD’s CAGR is 13.06 percentage points lower than that of XLY and as a result, would have yielded $46,671 less on a $10,000 investment. Thus, GLD performed worse than XLY by 13.06% annually.


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