XLP alternatives and similar ETFs

XLP alternatives at a glance#

Each fund below can stand in for XLP, closest first. “Same kind” funds hold the same kind of stocks through a different index. “Related” funds make a different bet that often moves the same way.

Fees come from each fund company, checked on the dates shown on each fund’s page.

How XLP and its alternatives did over the same dates#

Each row measures the alternative and XLP on the days both traded, so neither gets a head start. Correlation shows how closely their daily moves matched over about the last five years. A value of 1 means they always moved together.

Prices through October 16, 2026. Figures use daily closing prices adjusted for splits, with dividends reinvested. They do not include taxes or the cost of buying and selling. Past results do not tell you what will happen next.

Each XLP alternative, compared#

VDC: Vanguard Consumer Staples ETF#

VDC also holds US companies that sell things people buy in good times and bad, such as food and soap. It tracks the MSCI US Investable Market Consumer Staples 25/50 Index, while XLP tracks the Consumer Staples Select Sector Index.

It charges 0.09% a year, about $9 on $10,000, against $8 for XLP. It held 103 stocks, against 35 for XLP.

From January 2004 to October 2026, VDC returned about 9.5% a year and XLP returned about 9.1% a year. Over about the last five years they moved almost exactly together (correlation 0.99).

Read the VDC fund page for its returns by year and worst drop.

USMV: iShares MSCI USA Min Vol Factor ETF#

USMV is a looser match. It holds US stocks picked by rules for steady profits or smaller price swings, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.15% a year, about $15 on $10,000, against $8 for XLP. It held 174 stocks, against 35 for XLP.

From October 2011 to October 2026, USMV returned about 11.7% a year and XLP returned about 10.1% a year. Over about the last five years they often moved together, but not always (correlation 0.73).

Read the USMV fund page for its returns by year and worst drop.

XLV: State Street Health Care Select Sector SPDR ETF#

XLV is a looser match. It holds US drug makers, medical device makers and health insurers, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.08% a year, about $8 on $10,000, against $8 for XLP. It held 61 stocks, against 35 for XLP.

From December 1998 to October 2026, XLV returned about 8.9% a year and XLP returned about 6.9% a year. Over about the last five years they often moved together, but not always (correlation 0.62).

Read the XLV fund page for its returns by year and worst drop.

VHT: Vanguard Health Care ETF#

VHT is a looser match. It holds US drug makers, medical device makers and health insurers, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.09% a year, about $9 on $10,000, against $8 for XLP. It held 412 stocks, against 35 for XLP.

From January 2004 to October 2026, VHT returned about 10.1% a year and XLP returned about 9.1% a year. Over about the last five years they often moved together, but not always (correlation 0.60).

Read the VHT fund page for its returns by year and worst drop.

XLU: State Street Utilities Select Sector SPDR ETF#

XLU is a looser match. It holds US electric, gas and water companies, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.08% a year, about $8 on $10,000, against $8 for XLP. It held 31 stocks, against 35 for XLP.

From December 1998 to October 2026, XLU returned about 7.4% a year and XLP returned about 6.9% a year. Over about the last five years they often moved in different ways (correlation 0.57).

Read the XLU fund page for its returns by year and worst drop.

VPU: Vanguard Utilities ETF#

VPU is a looser match. It holds US electric, gas and water companies, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.09% a year, about $9 on $10,000, against $8 for XLP. It held 68 stocks, against 35 for XLP.

From January 2004 to October 2026, VPU returned about 9.4% a year and XLP returned about 9.1% a year. Over about the last five years they often moved in different ways (correlation 0.56).

Read the VPU fund page for its returns by year and worst drop.

QUAL: iShares MSCI USA Quality Factor ETF#

QUAL is a looser match. It holds US stocks picked by rules for steady profits or smaller price swings, while XLP holds US companies that sell things people buy in good times and bad, such as food and soap.

It charges 0.15% a year, about $15 on $10,000, against $8 for XLP. It held 118 stocks, against 35 for XLP.

From July 2013 to October 2026, QUAL returned about 13.6% a year and XLP returned about 8.6% a year. Over about the last five years they often moved in different ways (correlation 0.48).

Read the QUAL fund page for its returns by year and worst drop.

XLP versions from other fund companies#

Some people keep all their funds with one company. Here is the closest fund to XLP from each other company on this page:

• Vanguard: VDC, Vanguard Consumer Staples ETF (same kind of fund, 0.09% a year)
• iShares (BlackRock): USMV, iShares MSCI USA Min Vol Factor ETF (related fund, 0.15% a year)

Most brokers let you buy any ETF, whoever runs it. Mutual fund versions, such as a fund company’s index mutual fund, are not listed here.

How to choose between XLP and its alternatives#

• What it tracks. A fund on the same index holds the same stocks. A different index can mean different weights, more or fewer holdings, or a different mix.
• The fee. The difference is often small. On $10,000, XLP costs about $8 a year.
• History. An older fund has been through more bad markets, so you can see how far it fell.
• What you already own. Two funds that move together add little variety. A fund with a low correlation behaves more on its own.

Swapping XLP to harvest a tax loss#

Some investors sell a fund at a loss to lower their taxes, then buy a similar fund so they stay invested. This is called tax-loss harvesting.

The IRS wash sale rule blocks the loss if you buy a “substantially identical” security within 30 days before or after the sale. The IRS has not said exactly when two funds count. Funds on the same index are more likely to. Funds on a different index, such as VDC, USMV or XLV, are less likely to.

Ask a tax professional before you rely on this. Read the IRS rules in Publication 550.

Test XLP and its alternatives in a backtest#

Tactfolio is a platform where you build rules-based investing strategies, backtest them on decades of real prices, share them, and run them automatically in your own Alpaca account. Open the builder, add XLP and VDC, and see how each would have done on the same dates, or how a mix of both would have done.

The details#

Alternatives are picked from facts, not from returns. First come funds that track the same index as XLP. Then come funds that hold the same kind of stocks through another index. Last come funds from a close category that make a different bet. Leveraged funds are only listed as alternatives to other leveraged funds.

Within each group, the funds whose daily returns moved most like XLP over about the last five years come first. Returns and worst drops use Tactfolio’s stored daily prices, adjusted for splits, with dividends reinvested. Each alternative is measured with XLP only on days both traded. Read what a backtest simulates for more on these measures.