XLE vs TAN: Head-to-Head Comparison
XLE vs TAN: Energy Select Sector SPDR Fund has an expense ratio of 0.09% while Invesco Solar ETF charges 0.67%. XLE holds 23 securities vs TAN's 45. 5-year returns: 14.20% vs 2.00%.
Last updated: April 2026
Energy
Quick Verdict
XLE edges out TAN with a stronger Beginner Suitability Score (7.5 vs 7). It offers lower fees for new investors.
Side-by-Side Comparison
| Metric | XLE | TAN |
|---|---|---|
| Expense Ratio | 0.09% | 0.67% |
| AUM | $35.0B | $1.5B |
| Dividend Yield | 3.30% | 0.40% |
| Holdings | 23 | 45 |
| 1-Year Return | 9.50% | -15.00% |
| 5-Year Return (Ann.) | 14.20% | 2.00% |
| 10-Year Return (Ann.) | 5.50% | 5.00% |
| Beta | 1.12 | 1.40 |
| P/E Ratio | 13.5 | 32.0 |
XLE 5-year annualized return is 14.20% compared to TAN's 2.00%. Over 10 years, XLE returned 5.50% vs TAN's 5.00%.
View data table
| Period | XLE Return | TAN Return |
|---|---|---|
| YTD | 1.80% | -8.00% |
| 1 Year | 9.50% | -15.00% |
| 3 Year | 18.50% | -20.00% |
| 5 Year | 14.20% | 2.00% |
| 10 Year | 5.50% | 5.00% |
Key Differences Between XLE and TAN
XLE (Energy Select Sector SPDR Fund) is a energy sector fund managed by State Street Global Advisors. XLE holds the energy companies from the S&P 500, including major oil and gas producers, refiners, and energy equipment providers. It is the most popular way to get targeted exposure to the traditional energy sector. Beginners should understand that XLE is heavily tied to oil and gas prices, making it a cyclical investment that can deliver strong returns when energy prices rise but suffer during downturns.
TAN (Invesco Solar ETF) is a solar energy fund managed by Invesco. TAN focuses specifically on companies in the solar energy industry, including manufacturers of solar panels, inverters, and installation firms. It provides concentrated exposure to one of the fastest-growing segments of the clean energy market. This fund suits investors who believe solar power will play a dominant role in the future global energy mix.
The most notable differences are in fees (0.09% vs 0.67%), number of holdings (23 vs 45), and 5-year returns (14.20% vs 2.00%).
XLE vs TAN multi-factor comparison: XLE has a 0.09% expense ratio, 14.20% 5-year return, 23 holdings, 1.12 beta, and 3.30% yield. TAN has 0.67% expense ratio, 2.00% 5-year return, 45 holdings, 1.40 beta, and 0.40% yield.
View data table
| Metric | XLE | TAN |
|---|---|---|
| Expense Ratio | 0.09% | 0.67% |
| 5-Year Return | 14.20% | 2.00% |
| Holdings | 23 | 45 |
| Beta | 1.12 | 1.40 |
| Dividend Yield | 3.30% | 0.40% |
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Holdings Overlap Analysis
0%
Holdings Overlap
XLE and TAN share only 0% of their top holdings. These funds are quite different, making them complementary choices if you want broader market coverage.
XLE and TAN share 0% of their top holdings (low overlap). XLE has 23 total holdings and TAN has 45.
View data table
| Metric | XLE | TAN |
|---|---|---|
| Overlap | 0% | 0% |
| Unique Holdings | 100% | 100% |
| Total Holdings | 23 | 45 |
Cost Comparison Over Time
If you invest $10,000 and hold for 20 years (assuming 8% annual returns):
XLE
Fee cost: $771
TAN
Fee cost: $5,455
Over 20 years, the fee difference amounts to $4,684 on a $10,000 investment. XLE saves you more in fees over time.
On a $10,000 investment over 20 years at 8% return, XLE (0.09% fee) grows to $45,839 while TAN (0.67% fee) grows to $41,155. The fee difference costs $4,684.
View data table
| Year | XLE Value | TAN Value |
|---|---|---|
| 0 | $10,000 | $10,000 |
| 5 | $14,632 | $14,243 |
| 10 | $21,410 | $20,287 |
| 15 | $31,327 | $28,895 |
| 20 | $45,839 | $41,155 |
Which One Should a Beginner Choose?
Choose XLE if: You want investors who want to overweight energy based on their outlook for oil and gas prices, income seekers attracted to the high dividends paid by profitable energy companies, tactical investors using energy as an inflation hedge during rising commodity price environments. It's managed by State Street Global Advisors with an expense ratio of 0.09%.
Choose TAN if: You want investors with high conviction specifically in solar energy's growth trajectory, those who want targeted solar exposure rather than broad clean energy diversification, aggressive growth investors comfortable with significant short-term price swings. It's managed by Invesco with an expense ratio of 0.67%.
Can You Own Both XLE and TAN?
Absolutely! With only 0% overlap, XLE and TAN complement each other well. A simple portfolio might allocate 60% to one and 40% to the other, or you could pair them with a bond ETF like BND for a complete three-fund portfolio.
Frequently Asked Questions
Should I buy XLE or TAN?▾
XLE edges out TAN with a stronger Beginner Suitability Score (7.5 vs 7). It offers lower fees for new investors. However, both are solid options. XLE is best for investors who want investors who want to overweight energy based on their outlook for oil and gas prices, while TAN is better suited for investors with high conviction specifically in solar energy's growth trajectory.
What is the difference between XLE and TAN?▾
XLE (Energy Select Sector SPDR Fund) tracks energy sector investments with 23 holdings and a 0.09% expense ratio. TAN (Invesco Solar ETF) focuses on solar energy with 45 holdings at 0.67%. Their top holdings overlap by 0%.
Can I own both XLE and TAN?▾
Yes! With only 0% holdings overlap, XLE and TAN complement each other well. Owning both gives you broader diversification.