The Technology Select Sector SPDR Fund (XLK) and the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) are both among the Top 100 ETFs. XLK is a SPDR State Street Global Advisors Technology fund and MINT is a PIMCO Ultrashort Bond fund. So, what’s the difference between XLK and MINT? And which fund is better?
The expense ratio of XLK is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%). XLK also has a high exposure to the technology sector while MINT is mostly comprised of Others bonds. Overall, XLK has provided higher returns than MINT over the past ten years.
In this article, we’ll compare XLK vs. MINT. We’ll look at performance and industry exposure, as well as at their fund composition and portfolio growth. Moreover, I’ll also discuss XLK’s and MINT’s holdings, annual returns, and risk metrics and examine how these affect their overall returns.
Summary
| XLK | MINT | |
| Name | Technology Select Sector SPDR Fund | PIMCO Enhanced Short Maturity Active Exchange-Traded Fund |
| Category | Technology | Ultrashort Bond |
| Issuer | SPDR State Street Global Advisors | PIMCO |
| AUM | 42.3B | 14.02B |
| Avg. Return | 20.02% | 1.52% |
| Div. Yield | 0.73% | 0.56% |
| Expense Ratio | 0.12% | 0.36% |
The Technology Select Sector SPDR Fund (XLK) is a Technology fund that is issued by SPDR State Street Global Advisors. It currently has 42.3B total assets under management and has yielded an average annual return of 20.02% over the past 10 years. The fund has a dividend yield of 0.73% with an expense ratio of 0.12%.
The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) is a Ultrashort Bond fund that is issued by PIMCO. It currently has 14.02B total assets under management and has yielded an average annual return of 1.52% over the past 10 years. The fund has a dividend yield of 0.56% with an expense ratio of 0.36%.
XLK’s dividend yield is 0.17% higher than that of MINT (0.73% vs. 0.56%). Also, XLK yielded on average 18.50% more per year over the past decade (20.02% vs. 1.52%). The expense ratio of XLK is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%).
Fund Composition
Holdings
| XLK Holdings | Weight |
| Apple Inc | 21.45% |
| Microsoft Corp | 20.37% |
| NVIDIA Corp | 4.98% |
| Visa Inc Class A | 3.95% |
| PayPal Holdings Inc | 3.42% |
| Mastercard Inc A | 3.19% |
| Adobe Inc | 2.8% |
| Salesforce.com Inc | 2.26% |
| Intel Corp | 2.26% |
| Cisco Systems Inc | 2.23% |
XLK’s Top Holdings are Apple Inc, Microsoft Corp, NVIDIA Corp, Visa Inc Class A, and PayPal Holdings Inc at 21.45%, 20.37%, 4.98%, 3.95%, and 3.42%.
Mastercard Inc A (3.19%), Adobe Inc (2.8%), and Salesforce.com Inc (2.26%) have a slightly smaller but still significant weight. Intel Corp and Cisco Systems Inc are also represented in the XLK’s holdings at 2.26% and 2.23%.
| MINT Bond Sectors | Weight |
| Others | 0.0% |
| Below B | 0.0% |
| B | 0.0% |
| BB | 0.0% |
| BBB | 0.0% |
| A | 0.0% |
| AA | 0.0% |
| AAA | 0.0% |
| US Government | 0.0% |
MINT’s Top Bond Sectors are ratings of Others, Below B, B, BB, and BBB at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%. The fund is less weighted towards A (0.0%), AA (0.0%), and AAA (0.0%) rated bonds.
Risk Analysis
| XLK | MINT | |
| Mean Return | 1.7 | 0.12 |
| R-squared | 73.56 | 4.7 |
| Std. Deviation | 15.58 | 1.08 |
| Alpha | 10.43 | 0.62 |
| Beta | 0.95 | 0.08 |
| Sharpe Ratio | 1.27 | 0.78 |
| Treynor Ratio | 21.44 | 10.8 |
The Technology Select Sector SPDR Fund (XLK) has a Alpha of 10.43 with a Mean Return of 1.7 and a Treynor Ratio of 21.44. Its R-squared is 73.56 while XLK’s Standard Deviation is 15.58. Furthermore, the fund has a Sharpe Ratio of 1.27 and a Beta of 0.95.
The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) has a Mean Return of 0.12 with a Beta of 0.08 and a R-squared of 4.7. Its Sharpe Ratio is 0.78 while MINT’s Standard Deviation is 1.08. Furthermore, the fund has a Treynor Ratio of 10.8 and a Alpha of 0.62.
XLK’s Mean Return is 1.58 points higher than that of MINT and its R-squared is 68.86 points higher. With a Standard Deviation of 15.58, XLK is slightly more volatile than MINT. The Alpha and Beta of XLK are 9.81 points higher and 0.87 points higher than MINT’s Alpha and Beta.
Performance
Annual Returns
| Year | XLK | MINT |
| 2020 | 43.67% | 1.63% |
| 2019 | 49.97% | 3.3% |
| 2018 | -1.56% | 1.72% |
| 2017 | 34.27% | 1.9% |
| 2016 | 14.81% | 1.99% |
| 2015 | 5.62% | 0.52% |
| 2014 | 17.75% | 0.53% |
| 2013 | 25.98% | 0.72% |
| 2012 | 15.47% | 2.48% |
| 2011 | 2.69% | 0.42% |
| 2010 | 11.6% | 1.72% |
XLK had its best year in 2019 with an annual return of 49.97%. XLK’s worst year over the past decade yielded -1.56% and occurred in 2018. In most years the Technology Select Sector SPDR Fund provided moderate returns such as in 2016, 2012, and 2014 where annual returns amounted to 14.81%, 15.47%, and 17.75% respectively.
The year 2019 was the strongest year for MINT, returning 3.3% on an annual basis. The poorest year for MINT in the last ten years was 2011, with a yield of 0.42%. Most years the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund has given investors modest returns, such as in 2020, 2018, and 2010, when gains were 1.63%, 1.72%, and 1.72% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| XLK | $10,000 | $60,744 | 20.02% |
| MINT | $10,000 | $11,624 | 1.52% |
A $10,000 investment in XLK would have resulted in a final balance of $60,744. This is a profit of $50,744 over 10 years and amounts to a compound annual growth rate (CAGR) of 20.02%.
With a $10,000 investment in MINT, the end total would have been $11,624. This equates to a $1,624 profit over 10 years and a compound annual growth rate (CAGR) of 1.52%.
XLK’s CAGR is 18.50 percentage points higher than that of MINT and as a result, would have yielded $49,120 more on a $10,000 investment. Thus, XLK outperformed MINT by 18.50% annually.
