What Is XLP? Consumer Staples Select Sector SPDR Fund
Last updated July 2026
Short answer
XLP is the Consumer Staples Select Sector SPDR Fund, a cap-weighted ETF holding the roughly 40 consumer-staples companies in the S&P 500. It tracks the Consumer Staples Select Sector Index at a low 0.08% expense ratio, led by Walmart, Costco, Procter and Gamble, and Coca-Cola. As a defensive sector fund with steady dividends, it is a common way to add lower-volatility, everyday-essentials exposure versus a broad market fund or a rival staples ETF like VDC.
XLP is issued by State Street Global Advisors (SPDR) and tracks Consumer Staples Select Sector Index. It charges a 0.08% expense ratio, holds approximately ~$14 billion in assets under management, yields about ~2.6%, and launched in December 1998.
What is XLP?
XLP is the Consumer Staples Select Sector SPDR Fund, an exchange-traded fund that isolates the consumer-staples segment of the S&P 500. It tracks the Consumer Staples Select Sector Index and charges a very low 0.08% expense ratio, holding roughly 40 large, established companies.
The fund covers everyday-essentials businesses across food, beverages, household and personal products, tobacco, and staples retail. Because these companies sell goods people buy regardless of the economic cycle, XLP is widely used as a defensive, lower-volatility building block and a steady source of dividend income.
XLP holdings
Approximate weights as of mid-2026; refresh quarterly from State Street Global Advisors (SPDR)'s fund page. Each ticker links to its individual stock guide in Walnut.
| Rank | Ticker | Company | % of XLP | |
|---|---|---|---|---|
| 1 | WMT | Walmart Inc. | ~10.8% | |
| 2 | COST | Costco Wholesale Corporation | ~9.0% | |
| 3 | PG | The Procter & Gamble Company | ~7.4% | |
| 4 | KO | The Coca-Cola Company | ~6.8% | |
| 5 | PM | Philip Morris International Inc. | ~6.0% | |
| 6 | MDLZ | Mondelez International, Inc. | ~5.0% | |
| 7 | MO | Altria Group, Inc. | ~4.7% | |
| 8 | CL | Colgate-Palmolive Company | ~4.6% | |
| 9 | PEP | PepsiCo, Inc. | ~4.2% | |
| 10 | MNST | Monster Beverage Corporation | ~4.2% |
XLP is cap-weighted, so its largest holdings carry substantial weight. Top positions typically include Walmart, Costco, Procter and Gamble, Coca-Cola, Philip Morris International, Mondelez, Altria, Colgate-Palmolive, PepsiCo, and Monster Beverage.
With only around 40 constituents and heavy concentration at the top, the fund's performance leans on a handful of household-name giants. The roster spans staples retail, beverages, packaged food, household and personal care, and tobacco, giving broad but concentrated exposure to the defensive corner of the market.
XLP vs VDC
The most common comparison for XLP is Vanguard's VDC. Both target consumer staples at low cost, but XLP holds only the roughly 40 staples companies in the S&P 500, while VDC follows a broader index with over 100 holdings that reach further into mid and small-caps.
As a result, XLP is more concentrated in mega-cap staples, while VDC is slightly more diversified. Their long-term returns tend to be similar given the sector overlap, so the choice often comes down to a preference for XLP's liquidity and pure large-cap tilt versus VDC's broader reach.
Performance and outlook
XLP typically delivers steadier, lower-volatility returns than the broad market. It tends to hold up better during downturns as investors favor defensive earnings, but often lags during strong bull markets when growth and cyclical sectors lead.
The outlook for XLP rests on stable demand for essentials, pricing power at its major brands, and the appeal of dividends when rates and risk appetite shift. Its defensive profile makes it more about capital preservation and income than aggressive growth.
Is XLP a good fit?
XLP suits investors who want defensive, dividend-paying exposure to consumer staples, whether as a core stabilizer or a tactical tilt when they expect market turbulence. Its low fee and high liquidity make it easy to use, though its concentration and modest growth are worth weighing.
Walnut is not an investment adviser. This is descriptive information, not a recommendation. Whether XLP belongs in your portfolio depends on your goals, time horizon, risk tolerance, and existing holdings, so weigh those factors or consult a licensed professional before deciding.
How to buy XLP
XLP trades on the NYSE Arca and can be purchased through brokerages such as Robinhood, Fidelity, Charles Schwab, and Public. Many of these support fractional shares, so you can start with a small dollar amount rather than buying a full share.
You can also connect your existing brokerage to Walnut to track XLP alongside your other positions and build a basket around a defensive or income thesis. Walnut helps you monitor how the holding aligns with your target weights over time while your trades stay at your broker.
The bottom line on XLP
XLP is the largest, most liquid consumer-staples ETF, offering low-cost defensive exposure to household names at a 0.08% fee. It fits investors who want a steadier, dividend-paying sector tilt, though its concentration in a few giants and lower growth are tradeoffs to weigh.
More on XLP
Whether XLP is worth buying today depends more on your time horizon and what you already hold than on any single call. We walk through valuation, concentration, and what would have to be true for it to outperform from here in is XLP a buy?
XLP yields ~2.6% as of mid-2026, paid by passing through the dividends of its underlying holdings. For the payout schedule, history, and how the distributions are taxed, see XLP dividend: yield and schedule.
Build a portfolio around XLP with Walnut
Use XLP as your core holding, then let Walnut's AI propose thematic satellites: AI infrastructure, dividend growth, clean energy, whatever you believe in. Connect your broker, build the basket in conversation, track it as one unit.
FAQ
What is XLP?
+
XLP is the Consumer Staples Select Sector SPDR Fund, an ETF that holds the roughly 40 consumer-staples companies in the S&P 500. It tracks the Consumer Staples Select Sector Index on a cap-weighted basis, charges a low 0.08% expense ratio, and is led by Walmart, Costco, Procter and Gamble, and Coca-Cola.
Who issues XLP and what does it track?
+
XLP is issued by State Street Global Advisors under its SPDR brand and tracks the Consumer Staples Select Sector Index. That index isolates the consumer-staples companies within the S&P 500, covering food, beverage, household products, tobacco, and staples retail.
What does XLP hold?
+
XLP holds about 40 large consumer-staples companies. Top positions typically include Walmart, Costco, Procter and Gamble, Coca-Cola, Philip Morris International, PepsiCo, Mondelez, and Colgate-Palmolive. Because it is cap-weighted, the largest few names make up a big share of the fund.
What is the difference between XLP and VDC?
+
Both target consumer staples, but XLP holds only S&P 500 staples companies, around 40 names, while Vanguard's VDC follows a broader index with more mid and small-cap staples, over 100 holdings. XLP is more concentrated in mega-caps; VDC is a touch broader. Fees are similar and low.
What is XLP's expense ratio?
+
XLP charges an expense ratio of just 0.08%, or about 80 cents a year per 1,000 dollars invested. That is very low for a sector ETF and reflects its simple, rules-based approach of holding the consumer-staples members of the S&P 500.
Does XLP pay a dividend?
+
Yes. XLP yields roughly 2.6% as of mid-2026 and pays quarterly distributions. Consumer-staples companies are known for stable cash flows and consistent dividends, which makes XLP a popular choice for investors seeking steady income alongside defensive exposure.
How do I buy XLP?
+
XLP trades on the NYSE Arca and can be bought through brokerages like Robinhood, Fidelity, Charles Schwab, and Public, most of which support fractional shares. You can also connect your broker to Walnut to track XLP alongside your other holdings and build a basket around a defensive or income thesis.
How big is XLP?
+
XLP has roughly 14 billion dollars in assets under management as of mid-2026, making it the largest and most liquid consumer-staples ETF. Its scale and tight trading spreads make it a common core holding for investors seeking defensive sector exposure.
Is XLP a good investment?
+
Whether XLP fits depends on your goals, risk tolerance, and portfolio. It offers lower-volatility, dividend-paying exposure to defensive staples, but tends to lag in strong bull markets and is concentrated in a few large names. Walnut is not an investment adviser, so treat this as descriptive information and consider your own situation before investing.
When was XLP created?
+
XLP launched in December 1998 as one of the original Select Sector SPDR funds. It has a long track record spanning multiple market cycles, and its defensive character has made it a widely used tool for reducing portfolio volatility during downturns.
Is XLP a defensive investment?
+
XLP is generally considered defensive. Consumer staples are everyday essentials like food, beverages, and household products that people buy regardless of the economy, so the sector's earnings are relatively stable. XLP tends to hold up better than the broad market in downturns but often lags during strong rallies.
Why is XLP concentrated in a few stocks?
+
XLP is cap-weighted, so the largest consumer-staples companies in the S&P 500 dominate the fund. Names like Walmart, Costco, Procter and Gamble, and Coca-Cola together make up a large share of assets, meaning XLP's performance leans heavily on a handful of giants.
Does XLP include tobacco and retail?
+
Yes. XLP's definition of consumer staples includes tobacco companies like Philip Morris International and Altria, as well as staples retailers like Walmart and Costco, alongside food, beverage, and household-products makers. Investors who want to avoid tobacco should note that exposure.
How does XLP perform in a recession?
+
Historically, consumer-staples funds like XLP tend to be relatively resilient in recessions because demand for essentials holds up. XLP often declines less than the broad market during downturns, though it can still fall, and past resilience does not guarantee future results.
How do I compare XLP to similar ETFs?
+
Put a few fields side by side: the expense ratio (fees compound over decades), the index or strategy it tracks, the top holdings and how much they overlap with what you already own, the dividend yield, and the AUM, liquidity, and bid-ask spread that affect trading costs. For index funds, tracking error (how closely it follows its index) and tax efficiency matter too. XLP's figures are above; the full method is in Walnut's guide on how to compare ETFs.
Related ETFs
Walnut is informational, not investment advice. Holdings weights and fund statistics on this page are approximations stamped to mid-2026; verify current figures against State Street Global Advisors (SPDR)'s fund page or your broker before investing.