Consumer Staples ETFs: How PBJ and XLP Stack Up
Key Points
State Street Consumer Staples Select Sector SPDR ETF offers a significantly lower expense ratio and higher dividend yield than Invesco Food & Beverage ETF
Invesco Food & Beverage ETF uses a quant-based selection strategy focused on 30 stocks while State Street Consumer Staples Select Sector SPDR ETF tracks larger market-cap leaders
State Street Consumer Staples Select Sector SPDR ETF has delivered stronger five-year total returns and maintains a much larger assets under management base
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The State Street Consumer Staples Select Sector SPDR ETF (NYSEMKT:XLP) offers a low-cost, high-liquidity route to large-cap staples, whereas the Invesco Food & Beverage ETF (NYSEMKT:PBJ) uses a proprietary selection process to target niche food and beverage companies.
Both funds target the defensive consumer sector but through different lenses. While PBJ uses an Intellidex strategy to select 30 specific food-related stocks based on capital appreciation potential, XLP tracks the consumer staples heavyweights of the S&P 500, offering a more traditional market-cap-weighted profile for defensive investors.
Snapshot (cost & size)
| Metric | PBJ | XLP |
|---|---|---|
| Issuer | Invesco | SPDR |
| Expense ratio | 0.61% | 0.08% |
| 1-yr return (as of June 8, 2026) | 1.00% | 4.50% |
| Dividend yield | 1.60% | 2.60% |
| Beta | 0.48 | 0.47 |
| AUM | $89.5 million | $14.7 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
The State Street fund is notably more affordable, with an expense ratio of 0.08% compared to 0.61% for the Invesco fund. Additionally, XLP provides a higher payout, with a distribution yield roughly 1.00 percentage point above PBJ.
Performance & risk comparison
| Metric | PBJ | XLP |
|---|---|---|
| Max drawdown (5 yr) | (15.80%) | (16.30%) |
| Growth of $1,000 over 5 years (total return) | $1,174 | $1,344 |
Over the last five years, XLP has achieved higher total growth, turning $1,000 into $1,344, while PBJ reached $1,174. Both funds exhibit low volatility, with betas well below the broader market average.
What's inside
The State Street Consumer Staples Select Sector SPDR ETF (NYSEMKT:XLP) tracks the Consumer Staples Select Sector Index, providing exposure to 36 holdings. Its portfolio is almost entirely dedicated to consumer defensives at 99.00%, with a minor 1.00% tilt toward consumer cyclicals. Its largest positions include Walmart (NASDAQ:WMT) at 11.12%, Costco Wholesale (NASDAQ:COST) at 9.21%, and Procter & Gamble (NYSE:PG) at 7.27%. This fund, which was launched in 1998, has paid $2.18 per share over the trailing 12 months.
In contrast, the Invesco Food & Beverage ETF (NYSEMKT:PBJ) follows the Dynamic Food & Beverage Intellidex Index, holding 31 companies with a more concentrated focus on consumer defensives at 79.00%, plus 10.00% in consumer cyclicals and 6.00% in industrials. Its largest positions include Archer-Daniels-Midland (NYSE:ADM) at 5.23%, Monster Beverage (NASDAQ:MNST) at 5.16%, and Coca-Cola (NYSE:KO) at 4.98%. Launched in 2005, the fund has a trailing-12-month dividend of $0.75 per share and has no unique quirks in its structure.
For more guidance on ETF investing, check out the full guide at this link.
Which looks like the better buy
The State Street Consumer Staples Select Sector SPDR ETF (XLP) and the Invesco Food & Beverage ETF (PBJ) are both sector-focused exchange-traded funds (ETFs) that provide significant exposure to consumer staples stocks. Here’s how they compare to one another.
First, let’s have a look at PBJ. This fund is laser-focused on the food and beverage sub-sector. Its top holdings include Coca-Cola, PepsiCo (NASDAQ:PEP), and Starbucks (NASDAQ:SBUX). As for performance, the fund has lagged the broader market, as represented by the benchmark S&P 500. That’s not entirely unexpected, as consumer staples are a defensive sector, which typically has lower volatility than other, faster-growing segments of the market. PBJ has delivered a total return of 344% since its inception in 2005, equating to a compound annual growth rate (CAGR) of 7.4%. The S&P 500, on the other hand, has delivered a total return of 819% over the same period, with a CAGR of 11.2%.
Then, there’s XLP. This fund has a broader portfolio of holdings in the consumer staples sector, branching out well beyond food and beverage companies. Top holdings include consumer giants like Procter & Gamble, Target (NYSE:TGT), and Colgate-Palmolive (NYSE:CL). Since 2005, XLP has delivered a total return of 541% and a CAGR of 9.3%.
In summary, PBJ and XLP are both defensive ETFs, though they use different methodologies. XLP takes a sector-wide approach, holding names across the consumer staples spectrum. Meanwhile, PBJ’s focus on the food and beverage sub-sector is even more defensive, leading to its lower max drawdown. XLP has delivered superior long-term performance, boasts a much lower expense ratio of 0.08%, and a higher dividend yield of 2.6%.
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Jake Lerch has positions in Coca-Cola and Procter & Gamble. The Motley Fool has positions in and recommends Colgate-Palmolive, Costco Wholesale, Monster Beverage, Starbucks, Target, and Walmart. The Motley Fool has a disclosure policy.
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