Wealthy PotVGT vs XLK: Two Tech ETFs, One Broad and One Concentrated
VGT and XLK are the two most popular technology-sector ETFs, and on the numbers that usually decide these things, fee and return, they're almost identical. The real difference is how wide a net each casts: VGT holds hundreds of tech names across all sizes, while XLK holds only the tech stocks in the S&P 500. This guide uses figures pulled straight from the funds' own documents.
The Short Answer
- Want the broadest tech exposure, including mid- and small-cap tech? VGT. It holds ~321 stocks across all sizes at 0.09%.
- Want a concentrated bet on the biggest tech names? XLK. It holds only ~73 S&P 500 tech stocks at 0.08%, more top-heavy in the mega-caps.
Fees (0.09% vs 0.08%) and 10-year returns are within a whisker of each other. Choose on breadth and concentration, not performance.
The Difference Is Breadth
- VGT is the Vanguard Information Technology ETF. It tracks the MSCI US Investable Market Information Technology 25/50 Index, about 321 holdings spanning large, mid, and small-cap technology companies, a broad definition of the sector.
- XLK is the Technology Select Sector SPDR Fund. It tracks the Technology Select Sector Index, only the technology companies within the S&P 500, about 73 holdings, all large caps, and more concentrated in the top two or three names.
Both are dominated by the same mega-caps (Apple, Microsoft, NVIDIA), so their returns track closely. VGT simply adds a long tail of smaller tech companies that XLK skips.
VGT vs XLK Side by Side
| Feature | VGT | XLK |
|---|---|---|
| Fund | Vanguard Information Technology ETF | Technology Select Sector SPDR |
| Index tracked | MSCI US IMI Information Technology 25/50 | Technology Select Sector (S&P 500 tech) |
| Expense ratio | 0.09% | 0.08% |
| Number of holdings | ~321 | ~73 |
| Cap coverage | Large + mid + small | Large-cap (S&P 500 only) |
| SEC 30-day yield | ~0.33% | ~0.44% |
| 10-year return (avg annual, NAV) | 24.49% | 24.30% |
| Growth of $10,000 over those 10 years (hypothetical) | $89,400 | $88,000 |
The 10-year returns differ by less than a quarter of a percent, effectively a tie, which is what you'd expect from two funds anchored by the same mega-cap tech names.
Which One Fits You
Choose VGT if: you want the fullest tech-sector exposure, including the mid- and small-cap names, and slightly more diversification within the sector. It's the broader building block.
Choose XLK if: you want a concentrated position in the largest tech companies and a marginally lower fee, and you don't need the smaller-cap tail. It's the more top-heavy, large-cap-only option. Either way, remember a single-sector tech fund is a concentrated bet, most investors hold one as a tilt around a diversified core, not as the whole portfolio. For a broader growth alternative, compare VGT vs QQQ.
FAQ
Is VGT or XLK better?
They're near-twins on fee (0.09% vs 0.08%) and 10-year return (within ~0.2%). The difference is breadth: VGT holds ~321 tech stocks across all sizes; XLK holds only ~73 S&P 500 tech names and is more concentrated. Choose VGT for broader tech, XLK for a concentrated large-cap bet.
Why does VGT hold so many more stocks than XLK?
VGT's index (MSCI US IMI Information Technology) includes mid- and small-cap tech companies, while XLK's index only covers technology stocks already in the S&P 500, which are all large caps. That's why VGT has ~321 holdings and XLK ~73.
Do VGT and XLK have the same top holdings?
Largely yes, both are dominated by Apple, Microsoft, and NVIDIA, which is why their returns track so closely. XLK just concentrates more weight in those top names, while VGT spreads a bit into smaller tech companies.
Are VGT and XLK too risky?
Both are single-sector funds concentrated in technology, so they're more volatile than a diversified market fund. Most investors use them as a growth tilt around a broad core rather than as a standalone portfolio.
Related comparisons: VGT vs QQQ · QQQ vs VOO · VUG vs VOO · SCHG vs VOO · All ETF comparisons
Primary sources: expense ratios, indexes, holdings, yields, and returns are from the issuers' official documents for VGT (Vanguard) and XLK (State Street). Both 10-year NAV returns as of Aug 31, 2026; VGT SEC yield as of Aug 31, 2026; XLK SEC yield as of Sep 10, 2026. For background, see the SEC's Investor.gov guide to mutual funds and ETFs.
This article is for educational purposes only and is not investment advice. Investing involves risk, including possible loss of principal, and past performance does not guarantee future results. Single-sector funds are concentrated and more volatile than the broad market. Expense ratios, yields, and holdings change over time; confirm current figures on the issuer's site before investing. Consult a qualified financial professional before making investment decisions.