The Health Care Select Sector SPDR Fund (XLV) and the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) are both among the Top 100 ETFs. XLV is a SPDR State Street Global Advisors Health fund and MINT is a PIMCO Ultrashort Bond fund. So, what’s the difference between XLV and MINT? And which fund is better?
The expense ratio of XLV is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%). XLV also has a high exposure to the healthcare sector while MINT is mostly comprised of Others bonds. Overall, XLV has provided higher returns than MINT over the past ten years.
In this article, we’ll compare XLV vs. MINT. We’ll look at fund composition and performance, as well as at their annual returns and industry exposure. Moreover, I’ll also discuss XLV’s and MINT’s portfolio growth, risk metrics, and holdings and examine how these affect their overall returns.
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Summary
| XLV | MINT | |
| Name | Health Care Select Sector SPDR Fund | PIMCO Enhanced Short Maturity Active Exchange-Traded Fund |
| Category | Health | Ultrashort Bond |
| Issuer | SPDR State Street Global Advisors | PIMCO |
| AUM | 27.88B | 14.02B |
| Avg. Return | 15.02% | 1.52% |
| Div. Yield | 1.4% | 0.56% |
| Expense Ratio | 0.12% | 0.36% |
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%.
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%.
XLV’s dividend yield is 0.84% higher than that of MINT (1.4% vs. 0.56%). Also, XLV yielded on average 13.50% more per year over the past decade (15.02% vs. 1.52%). The expense ratio of XLV is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%).
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Fund Composition
Holdings
| XLV Holdings | Weight |
| Johnson & Johnson | 9.19% |
| UnitedHealth Group Inc | 8.01% |
| Pfizer Inc | 4.64% |
| Abbott Laboratories | 4.36% |
| AbbVie Inc | 4.21% |
| Thermo Fisher Scientific Inc | 4.2% |
| Merck & Co Inc | 4.17% |
| Eli Lilly and Co | 3.87% |
| Danaher Corp | 3.61% |
| Medtronic PLC | 3.54% |
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%.
| 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
| XLV | MINT | |
| Mean Return | 1.27 | 0.12 |
| R-squared | 58.19 | 4.7 |
| Std. Deviation | 12.94 | 1.08 |
| Alpha | 7.75 | 0.62 |
| Beta | 0.7 | 0.08 |
| Sharpe Ratio | 1.13 | 0.78 |
| Treynor Ratio | 21.1 | 10.8 |
The Health Care Select Sector SPDR Fund (XLV) has a Beta of 0.7 with a R-squared of 58.19 and a Standard Deviation of 12.94. Its Alpha is 7.75 while XLV’s Mean Return is 1.27. Furthermore, the fund has a Treynor Ratio of 21.1 and a Sharpe Ratio of 1.13.
The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) has a Beta of 0.08 with a Mean Return of 0.12 and a Sharpe Ratio of 0.78. Its Treynor Ratio is 10.8 while MINT’s Alpha is 0.62. Furthermore, the fund has a Standard Deviation of 1.08 and a R-squared of 4.7.
XLV’s Mean Return is 1.15 points higher than that of MINT and its R-squared is 53.49 points higher. With a Standard Deviation of 12.94, XLV is slightly more volatile than MINT. The Alpha and Beta of XLV are 7.13 points higher and 0.62 points higher than MINT’s Alpha and Beta.
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Performance
Annual Returns
| Year | XLV | MINT |
| 2020 | 13.33% | 1.63% |
| 2019 | 20.63% | 3.3% |
| 2018 | 6.3% | 1.72% |
| 2017 | 21.7% | 1.9% |
| 2016 | -2.83% | 1.99% |
| 2015 | 6.82% | 0.52% |
| 2014 | 25.17% | 0.53% |
| 2013 | 41.24% | 0.72% |
| 2012 | 17.56% | 2.48% |
| 2011 | 12.44% | 0.42% |
| 2010 | 2.91% | 1.72% |
XLV had its best year in 2013 with an annual return of 41.24%. XLV’s worst year over the past decade yielded -2.83% and occurred in 2016. In most years the Health Care Select Sector SPDR Fund provided moderate returns such as in 2011, 2020, and 2012 where annual returns amounted to 12.44%, 13.33%, and 17.56% 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 |
| XLV | $10,000 | $42,899 | 15.02% |
| MINT | $10,000 | $11,624 | 1.52% |
A $10,000 investment in XLV would have resulted in a final balance of $42,899. This is a profit of $32,899 over 10 years and amounts to a compound annual growth rate (CAGR) of 15.02%.
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%.
XLV’s CAGR is 13.50 percentage points higher than that of MINT and as a result, would have yielded $31,275 more on a $10,000 investment. Thus, XLV outperformed MINT by 13.50% annually.
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