XLRE vs VNQ: S&P 500 REIT Slice vs the Full REIT Market
XLRE holds only the real estate companies inside the S&P 500. VNQ holds the entire U.S. REIT market. The fee gap is just 4 basis points, but the holdings gap is large: 31 stocks versus 160+.
XLRE (Real Estate Select Sector SPDR Fund) and VNQ (Vanguard Real Estate ETF) are both REIT ETFs, but they draw from different universes. XLRE holds only the real estate companies inside the S&P 500 — currently about 31 REITs including Prologis, American Tower, Equinix, and Welltower. VNQ tracks the MSCI US Investable Market Real Estate 25/50 Index, which holds 160+ REITs and real estate companies including many smaller names not in the S&P 500. XLRE charges 0.09% versus VNQ's 0.13%. The 4 basis point fee advantage for XLRE is real but modest. The more meaningful difference is scope: XLRE gives you concentrated large-cap REIT exposure; VNQ gives you the full market. For most investors who want broad real estate exposure, VNQ's wider net is worth the 4 basis point premium. XLRE makes more sense if you specifically want to express a view on large-cap REITs or if you are building a portfolio that already includes S&P 500 exposure and want a targeted sector add.
Whether the lower-cost fund suits your situation depends on your existing holdings, account type, tax situation, and how you use each fund. This is a cost comparison, not a personalized recommendation.
Both funds trade commission-free at every major brokerage. How the major brokerages compare →
📋 XLRE vs VNQ — Key Facts Side by Side
| Metric | XLRE | VNQ |
|---|---|---|
| Fund Name | State Street Real Estate Select Sector SPDR ETF | Vanguard Real Estate ETF |
| Issuer | SPDR | Vanguard |
| Tracks Index | Real Estate Select Sector Index (S&P 500) | MSCI US IMI Real Estate 25/50 |
| Expense Ratio | 0.09% ✓ | 0.13% |
| Cost per $10K/yr | $9.00 | $13.00 |
| AUM | $8.1B | $69.9B |
| Holdings | 31 | 165 |
| Inception | 2015 | 2004 |
| 1-Year Return | +9.71% | +11.89% |
| 3-Year Return | +9.80% | +9.77% |
| 5-Year Return | +2.91% | +2.55% |
| Dividend Yield | 3.19% | 3.60% |
| Holdings Overlap | See holdings overlap → | |
| Avg Bid-Ask Spread | 0.01% | 0.01% |
Expense ratio, AUM, and returns updated Aug 1, 2026 from ETF BFF database. Returns are annualised. Not investment advice.
📊 XLRE vs VNQ — Annualised Returns
Annualised returns (trailing, price-based). Past performance does not guarantee future results.
🎯 Which Fund Fits Which Investor?
- want the lowest fees: saves ~$4/yr per $10K vs VNQ
- want focused large-cap US stock exposure via Real Estate Select Sector Index (S&P 500)
- want broader diversification (165 holdings vs 31)
- already use Vanguard and prefer staying within one fund family
💰 What the Fee Difference Actually Costs
Adjust the numbers for your situation. This models each fund's expense ratio compounding against your balance over time.
Assumes a constant annual return reinvested, with each fund's expense ratio deducted yearly. Illustrative only; actual returns vary. Past performance does not guarantee future results.
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Side-by-side holdings overlap, sector breakdown, and live performance tabs, all in one place.
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❓ XLRE vs VNQ — Frequently Asked Questions
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