XLK — Technology Select Sector SPDR
SPDR (State Street) · Expense Ratio: 0.1% · Sectors · roughly average for its Sectors category
Key Facts
| Ticker | XLK |
| Full Name | Technology Select Sector SPDR |
| Provider | SPDR (State Street) |
| Expense Ratio | 0.1% |
| Category | Sectors |
| Assets Under Management | $80B |
| Inception Year | 1998 (28 years ago) |
| Number of Holdings | 65 |
| Dividend Yield | ~0.4% (negligible) |
| Top Holdings | AAPL, MSFT, NVDA |
What Is XLK?
XLK, managed by SPDR (State Street), launched in 1998, is a major ETF with deep liquidity and tight bid-ask spreads in the Sectors category. Sector-specific ETF targeting a particular industry like technology, healthcare, or energy. With $80B in assets under management, it benefits from deep institutional liquidity and tight bid-ask spreads.
XLK in a FIRE Portfolio
This fund serves as a satellite position — adding targeted exposure to sectors within a FIRE portfolio built around a broad-market core.
Satellite holdings typically make up 5-20% of your portfolio. Sector bets amplify risk — limit any single sector to 5-10% of your portfolio. The rest should stay in broad-market core holdings.
Cost Analysis: How XLK's 0.1% Fee Affects Your FIRE Timeline
At 0.1%, XLK is moderately priced. Annual fees on a $100K investment: $100. Over 30 years, the fee drag shaves approximately 0.6% off your total returns. For a $1M FIRE portfolio, that's about $10,000 in cumulative fees — noticeable but reasonable for most investors.
Dividend Income Potential
With a negligible dividend yield of approximately 0.4%, here's what XLK could generate in annual income at different portfolio sizes:
| Portfolio Value | Annual Dividend Income | Monthly Income |
|---|---|---|
| $100,000 | $400/year | $33/month |
| $250,000 | $1,000/year | $83/month |
| $500,000 | $2,000/year | $167/month |
| $1,000,000 | $4,000/year | $333/month |
Frequently Asked Questions About XLK
What is the expense ratio for XLK?
XLK has an expense ratio of 0.1%. This is moderately priced — on a $100K portfolio, annual fees are $100. Roughly average for its sectors category.
Is XLK good for a FIRE portfolio?
This fund serves as a satellite position — adding targeted exposure to sectors within a FIRE portfolio built around a broad-market core. Its 0.1% expense ratio is moderately priced for the Sectors category.
How does the 0.1% fee affect long-term returns?
At 0.1%, you'll pay $100/year per $100K invested. Over 30 years, fees reduce total returns by approximately 0.6%. Use the embedded calculator below to model the exact impact on your specific portfolio.
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