FDIS vs XLY: Which ETF Is Better in 2026?
A metric-by-metric comparison of Fidelity MSCI Consumer Discretionary Index ETF (FDIS) and State Street Consumer Discretionary Select Sector SPDR ETF (XLY) — both Consumer Discretionary funds — using ETFValuer's daily-updated rankings.
Educational content — not financial advice. Data as of July 25, 2026. ~5 minute read.
The Verdict
FDIS and XLY are close to the same fund wearing different labels. Both sit in the Consumer Discretionary category and their daily returns move almost identically, so this is not really a question of which fund is better — it is a question of which one is cheaper to own and easier to trade in your account. Everything below is about finding the small, structural edges, because the investment exposure is a wash.
On ETFValuer's overall model — which blends return, risk-adjusted performance, cost, drawdown, size and volatility — XLY scores higher: 44.9 (Grade D) versus 40.6 for FDIS. That doesn't make FDIS a bad fund; it means XLY currently edges it out on this specific mix of factors. Read the metric-by-metric breakdown below before deciding which matters more for your own portfolio.
Head-to-Head: Every Metric
| FDIS | XLY | |
|---|---|---|
| Category | Consumer Discretionary | Consumer Discretionary |
| Expense ratio | 0.08% | 0.08% |
| Fund size (AUM) | $1.7B | $22.6B |
| Dividend yield | 0.72% | 1.08% |
| 1-year return | -0.96% | -2.66% |
| 3-year return | +30.46% | +29.06% |
| Volatility | 19.27% | 19.25% |
| Max drawdown | -27.43% | -26.01% |
| Sharpe ratio | -0.31 | -0.40 |
| ETFValuer score | 40.6 | 44.9 |
| Grade | D | D |
| Overall rank | #417 | #397 |
Bold marks the better value in each row. "Better" is directional only (e.g. lower cost, higher return) — it isn't a recommendation by itself. See the full methodology.
Cost
On cost, the two are essentially tied — FDIS charges 0.08% a year versus XLY's 0.08%. A difference this small (about $0.40 a year on a $10,000 position) isn't a reason to choose one fund over the other. That matters more than usual here: when two funds track the same exposure this closely, fee is normally the whole argument — and with the fees this close, there is no argument left. Liquidity and whichever one trades commission-free in your account become the tiebreaker.
What FDIS's Fees Cost You
FDIS charges an expense ratio of 0.08% a year, deducted automatically from the fund's value. Small percentages compound into real money — adjust the figures below to see the impact on your own numbers.
Assumes a constant gross return and no additional contributions — a simplification, but it isolates exactly what the expense ratio costs. Try the full fee calculator to model contributions and compare any two funds.
Performance & Risk
Over the trailing 3 years, FDIS returned +30.46% versus +29.06% for XLY — a gap of about 1.4 percentage points. On risk, XLY has held up better historically, with a shallower max drawdown (-26.01% vs. -27.43%). FDIS currently has the better risk-adjusted return (Sharpe ratio of -0.31 vs. -0.40), meaning it delivered more return per unit of volatility taken on. Read that gap sceptically: for funds tracking near-identical exposure, a 1.4-point difference over three years is mostly noise from fee drag and timing, not evidence that one manager is better than the other.
How Closely Do They Track Each Other?
Over the last 3.0 years of daily returns (752 shared trading days), FDIS and XLY show a near-perfect correlation of 0.992 — functionally interchangeable. At this level the two funds are, for practical purposes, the same investment. Owning both adds no diversification whatsoever — the decision should come down entirely to cost, spread and which one your broker handles better.
| Measure | Value | What it means |
|---|---|---|
| Daily return correlation | 0.992 | Near-perfect — functionally interchangeable |
| R-squared | 98.4% | 98.4% of FDIS's daily moves are explained by XLY's |
| Tracking error (annualised) | 2.70% | Typical yearly spread between the two funds' returns |
| Annualised return over 3.0y | FDIS +9.91% · XLY +9.35% | FDIS ahead by 0.56 points a year |
Correlation alone understates how far these can drift. Across every rolling 12-month window in the period, FDIS finished as much as +3.0 points ahead of XLY at the best extreme and -5.6 points at the worst — a 8.6-point spread between the best and worst year of relative performance. Two funds can correlate tightly day to day and still deliver very different outcomes over any single year you happen to hold them.
Calculated from daily total returns over the trailing 3-year window, recomputed every day this site refreshes. Correlation of 1.00 means the two funds moved in lockstep; 0.00 means their daily moves were unrelated.
Holdings Overlap
FDIS and XLY hold 10 of the same companies among their top 10 positions. Those shared names make up 62.8% of FDIS and 70.3% of XLY. That's heavy duplication — owning both largely doubles down on the same companies rather than spreading risk. Most investors should pick one.
| Shared Holding | FDIS Weight | XLY Weight |
|---|---|---|
| Amazon.com Inc | 28.80% | 23.53% |
| Tesla Inc | 15.51% | 18.97% |
| Home Depot Inc/The | 4.44% | 5.94% |
| McDonald's Corp | 3.09% | 4.49% |
| TJX Cos Inc/The | 2.59% | 4.41% |
| Booking Holdings Inc | 2.03% | 3.38% |
| Lowe's Cos Inc | 1.99% | 3.30% |
| Starbucks Corp | 1.78% | 2.54% |
| O'Reilly Automotive Inc | 1.28% | 1.93% |
| Marriott International Inc/MD | 1.25% | 1.79% |
Compares the top 10 reported holdings from each fund's most recent SEC N-PORT-P filing, so it understates total overlap — funds tracking similar indexes overlap far more deeply than the top 10 alone can show. Search any company across all tracked funds with the Stock Overlap tool.
Which One Should You Pick?
Lean FDIS if…
- You care about return per unit of risk — its Sharpe ratio of -0.31 beats -0.40
- You weight recent results heavily — it returned 30.5% over 3 years against 29.1%
Lean XLY if…
- Current income matters to you — it yields 1.08% against 0.72%
- You want the deeper, more liquid market ($23B in assets vs $2B)
Whichever you pick, holding both at full weight is usually the wrong answer — see the overlap and correlation sections above.
Frequently Asked Questions
Is FDIS or XLY better?
On ETFValuer's overall model — which blends return, risk-adjusted performance, cost, drawdown, size and volatility — XLY scores higher: 44.9 (Grade D) versus 40.6 for FDIS. That doesn't make FDIS a bad fund; it means XLY currently edges it out on this specific mix of factors. Read the metric-by-metric breakdown below before deciding which matters more for your own portfolio.
Which has the lower expense ratio, FDIS or XLY?
XLY currently has the lower expense ratio (0.08% vs. 0.08%).
Can I hold both FDIS and XLY?
You can, but there's little point. FDIS and XLY have a daily return correlation of 0.99 over the past 3.0 years, meaning they move almost in lockstep. Holding both roughly doubles a single bet rather than spreading it — pick whichever wins on cost and liquidity and put the money in one place.
Go deeper on either fund
Full daily-updated metrics, holdings context, and category peers.