Real estate investors often weigh the stability of the domestic market against the growth potential of international properties. The State Street Real Estate Select Sector SPDR ETF (NYSEMKT:XLRE) provides concentrated exposure to the largest real estate companies in the S&P 500, while the Vanguard Global ex-U.S. Real Estate ETF (NASDAQ:VNQI) offers broad international diversification across 30 countries.
Let’s see how the two stack up for interested investors.
Snapshot (cost & size)
|
Metric |
VNQI |
XLRE |
|---|---|---|
|
Issuer |
Vanguard |
SPDR |
|
Expense ratio |
0.12% |
0.08% |
|
1-yr return (as of 6/18/26) |
4.5% |
8.5% |
|
Dividend yield |
4.8% |
3.2% |
|
Beta |
0.92 |
1.01 |
|
AUM |
$3.8 billion |
$8.1 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
The State Street fund is more affordable for long-term holders with an expense ratio of 0.08%, whereas the Vanguard fund charges 0.12%. Investors seeking immediate income may prefer the Vanguard fund, which currently offers a higher trailing-12-month distribution yield.
Performance & risk comparison
|
Metric |
VNQI |
XLRE |
|---|---|---|
|
Max drawdown (5 yr) |
(35.8%) |
(34.1%) |
|
Growth of $1,000 over 5 years (total return) |
$939 |
$1,167 |
What’s inside
The State Street Real Estate Select Sector SPDR ETF is a focused fund that tracks the Real Estate Select Sector Index with just 31 holdings. Its largest positions include Welltower at 10.4%, Prologis at 9.16%, and Equinix at 7.45%. This fund, which was launched in 2015, provides targeted exposure to domestic real estate management and equity trusts. It allocates 98% of its portfolio to the real estate sector and 2% to basic materials, and it has a trailing-12-month dividend of $1.40 per share.
In contrast, the Vanguard Global ex-U.S. Real Estate ETF offers a much broader scope by tracking the S&P Global ex-U.S. Property Index with more than 700 positions. Its top positions include Goodman Group at 4.3%, Mitsubishi Estate at 2.8%, and Mitsui Fudosan at 2.4%. Launched in 2010, the Vanguard fund captures non-U.S. real estate businesses across more than 30 countries. The portfolio is comprised of 93% real estate, 5% cash and other assets, and 1% industrials, and it has paid $2.16 per share over the trailing 12 months.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
Adding a real estate ETF to your portfolio can be a good way to add diversity, stability, and income generation. And while high interest rates and an uncertain macroeconomic environment have pressured the real estate sector recently, they may be flashing a buy signal before the sector eventually rebounds. Choosing between XLRE and VNQI comes down to what you want more out of your real estate investment.
