VDC Offers Broader Consumer Staples Exposure Than XLP, But Is It Really the Better Buy?

By Katie Brockman – Feb 12, 2026 at 7:40PM ESTKey PointsXLP carries a slightly higher yield and a marginally higher one-year return than VDC.VDC holds nearly three times as many stocks, offering broader exposure within consumer staples.Both ETFs show similar risk profiles and top holdings.We’re bullish on these 10 stocks ›NYSEMKT: VDCVanguard World Fund - Vanguard Consumer Staples ETFToday's Changeangle-down(1.27%) $3.04Current Price$241.86Price as of February 12, 2026 at 4:00 PM ETExplore how these two leading ETFs differ in diversification and portfolio structure for consumer staples investors.The State Street Consumer Staples Select Sector SPDR ETF (XLP +0.92%) and the Vanguard Consumer Staples ETF (VDC +1.27%) both aim to capture the performance of companies in the U.S. consumer staples sector, with each fund providing exposure to iconic brands in food, retail, and household products. This comparison explores how their costs, performance, risk, and portfolio composition stack up for investors seeking defensive sector allocations.Snapshot (cost & size)MetricXLPVDCIssuerSPDRVanguardExpense ratio0.08%0.09%1-yr return (as of Feb. 12, 2026)10.69%9.41%Dividend yield2.56%2.10%AUM$16 billion$9 billionBeta (5Y monthly)0.600.64Beta measures price volatility relative to the S&P 500. The 1-yr return represents total return over the trailing 12 months.Both funds are competitively priced, with XLP having a slight edge over VDC on fees due to its lower expense ratio. XLP also stands out for its higher dividend yield, which could appeal to income-focused investors.Performance & risk comparisonMetricXLPVDCMax drawdown (5 y)-16.32%-16.56%Growth of $1,000 over 5 years$1,360$1,406What's insideVDC holds 104 stocks, providing diversified exposure to the consumer defensive sector. Its largest positions are Walmart, Costco Wholesale, and Procter & Gamble, giving it a slightly broader portfolio than some sector peers.XLP, by contrast, is concentrated in just 36 companies, all within the consumer defensive sector. Its top holdings match VDC’s, but at smaller allocations than its competitor.For more guidance on ETF investing, check out the full guide at this link.What this means for investorsVDC provides a more diversified approach to consumer staples, with nearly three times as many holdings as XLP. However, it also leans more heavily on household names.While the two funds share the same top three holdings, those stocks make up 36.8% of VDC’s portfolio compared to 28.2% for XLP. This can make VDC more vulnerable to price swings — both positive and negative — if those particular stocks thrive or falter.That said, XPL’s much smaller portfolio could also increase its risk in other ways. If even a few of its stocks struggle to weather a downturn, it’s more likely to take a toll on its overall earnings compared to VDC.Over the last five years, the two funds have experienced remarkably similar performance. With nearly identical max drawdowns, they’re on almost equal footing in terms of past volatility. While XLP has earned marginally higher one-year total returns, VDC has edged ahead in five-year growth.For many investors, the difference in diversification could be the deciding factor. Those looking for greater exposure to more consumer staples stocks may prefer VDC’s larger portfolio, while XLP offers an advantage for those seeking a more targeted approach.Read NextFeb 10, 2026 •By Eric TrieConsumer Staples ETFs: Sector-Wide Defense or a Food-and-Beverage Tilt? VDC vs. PBJFeb 9, 2026 •By Katie BrockmanConsumer Staples Showdown: Is Vanguard VDC or iShares IYK the Better Buy for Investors?Feb 8, 2026 •By Robert IzquierdoBetter Consumer Staples ETF: Vanguard's VDC vs. First Trust's FTXGFeb 7, 2026 •By Sara AppinoVDC vs. PBJ: Does Comprehensive Coverage Beat Concentrated Food Bets?Jan 19, 2026 •By Josh Kohn-LindquistVanguad vs. iShares: Which Consumer Staples ETF Reigns Supreme, VDC or KXI?Dec 28, 2025 •By Robert IzquierdoBetter Consumer Staples ETF: Vanguard's VDC vs. Invesco's RSPSAbout the AuthorKatie Brockman is a contributing writer at The Motley Fool covering retirement, Social Security, and investing fundamentals. Prior to The Motley Fool, Katie held various writing and editing roles at companies ranging from small start-ups to multimillion-dollar brands. Her work has appeared in USA Today, Inc magazine, and other authoritative media outlets. She holds a bachelor’s degree in business administration and management from Illinois Wesleyan University.TMFKatieBrockmanStocks MentionedVanguard World Fund - Vanguard Consumer Staples ETFNYSEMKT: VDC$241.86 (+1.27%) $+3.04Select Sector SPDR Trust - State Street Consumer Staples Select Sector SPDR ETFNYSEMKT: XLP$89.21 (+0.92%) $+0.81*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.