Which Is the Better Tech ETF for Artificial Intelligence (AI) Stocks, State Street's XLK or Vanguard's VGT?

Robert Izquierdo, The Motley Fool

Mon, June 15, 2026 astatine 12:25 PM CDT 4 min read

The State Street Technology Select Sector SPDR ETF (NYSEMKT:XLK) offers much concentrated vulnerability to tech giants, portion the Vanguard Information Technology ETF (NYSEMKT:VGT) provides broader diversification crossed hundreds of smaller firms.

Both funds service arsenic superior vehicles for investors seeking artificial quality maturation stocks done the accusation exertion sector. While they stock galore apical positions, their underlying strategies effect successful antithetic levels of diversification and humanities performance. Choosing betwixt them depends connected whether 1 prefers the ratio of a giant-cap absorption oregon a broader marketplace reach.

Snapshot (cost & size)

Beta measures terms volatility comparative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr instrumentality represents full instrumentality implicit the trailing 12 months. Dividend output is the trailing-12-month organisation yield.

The Vanguard money is somewhat much costly with a 0.09% disbursal ratio, compared to 0.08% for the State Street fund. With $170.1 cardinal successful assets nether absorption (AUM), the Vanguard money is the larger of the 2 portfolios and offers a little dividend yield.

Performance & hazard examination

What's wrong

The Vanguard Information Technology ETF tracks a benchmark of electronics and machine companies, providing vulnerability to astir 310 holdings. Its largest positions see AI elephantine Nvidia (NASDAQ:NVDA) astatine 16.79%, Apple (NASDAQ:AAPL) astatine 15.27%, and Microsoft (NASDAQ:MSFT) astatine 9.88%. This fund, which launched successful 2004, has a trailing-12-month dividend of $0.38 per stock and focuses connected exertion stocks with minimal vulnerability to different sectors.

The State Street Technology Select Sector SPDR ETF was launched successful 1998 and holds a overmuch narrower portfolio of 72 stocks. Its largest positions see Nvidia astatine 13.23%, Apple astatine 11.53%, and Microsoft astatine 7.70%. The money has a trailing-12-month dividend of $0.76 per share. While its assemblage tilt is besides 100% technology, its reliance connected the S&P 500 scale beingness means it excludes the broader scope of mid-cap and small-cap firms recovered successful the Vanguard fund.

For much guidance connected ETF investing, cheque retired the afloat usher astatine this link.