U.S. Real Estate Leaders or Global Property Markets? XLRE vs. RWO
Key Points
State Street Real Estate Select Sector SPDR ETF offers a significantly lower expense ratio than State Street SPDR Dow Jones Global Real Estate ETF
State Street SPDR Dow Jones Global Real Estate ETF provides international exposure while State Street Real Estate Select Sector SPDR ETF focuses exclusively on U.S. large-cap holdings
Both funds offer similar trailing-12-month dividend yields exceeding 3.00% as of June 12, 2026
- 10 stocks we like better than Select Sector SPDR Trust - State Street Real Estate Select Sector SPDR ETF ›
The State Street Real Estate Select Sector SPDR ETF (NYSEMKT:XLRE) offers a low-cost, U.S.-concentrated alternative to the global reach and higher fee structure of the State Street SPDR Dow Jones Global Real Estate ETF (NYSEMKT:RWO).
Investors weighing real estate exposure often choose between domestic concentration and international diversification. While both funds are managed by State Street Global Advisors, they target different benchmarks. This analysis evaluates whether the low-cost, large-cap focus of one fund outweighs the broad, multi-country reach of the other for long-term income seekers.
Snapshot (cost & size)
| Metric | RWO | XLRE |
|---|---|---|
| Issuer | SPDR | SPDR |
| Expense ratio | 0.5% | 0.08% |
| 1-yr return (as of June 12, 2026) | 15.8% | 11.1% |
| Dividend yield | 3.30% | 3.1% |
| Beta | 0.90 | 0.96 |
| AUM | $1.24B | $7.95B |
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 cost difference is significant. XLRE charges a lean 0.08% annually, while RWO carries a 0.5% expense ratio. Despite the higher fee, RWO provided a slightly higher trailing-12-month dividend yield of 3.2% compared to 3.1% for its peer.
Performance & risk comparison
| Metric | RWO | XLRE |
|---|---|---|
| Max drawdown (5 yr) | (32.9%) | (34.1%) |
| Growth of $1,000 over 5 years (total return) | $1,118 | $1,177 |
What's inside
The State Street Real Estate Select Sector SPDR ETF (NYSEMKT:XLRE) offers a concentrated portfolio of 31 holdings, primarily targeting the real estate sector within the S&P 500. Its allocation includes 98% real estate and 2% basic materials. This fund, which launched in 2015, focuses on U.S. firms and has a trailing-12-month dividend of $1.40 per share. Its largest positions include Welltower Inc. (NYSE:WELL) at 9.93%, Prologis Inc. (NYSE:PLD) at 9.25%, and Equinix Inc. (NASDAQ:EQIX) at 6.93%. This narrow focus limits geographic diversification but ensures exposure to the most prominent American property companies.
The State Street SPDR Dow Jones Global Real Estate ETF (NYSEMKT:RWO) provides a more expansive approach with roughly 220 holdings across U.S., developed international, and emerging markets. Its portfolio is composed of 89% real estate, 7% cash and others, and 1% consumer cyclical. Launched in 2008, it has a trailing-12-month dividend of $1.62 per share. Top holdings include Welltower Inc. (NYSE:WELL) , Prologis Inc. (NYSE:PLD)and Equinix Inc.(NASDAQ:EQIX). By tracking a global index, RWO captures price movements from international real estate cycles that XLRE ignores.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
When comparing XLRE and RWO, the key difference is the source of your real estate exposure. XLRE invests in real estate companies within the S&P 500, while RWO includes property companies from both the U.S. and international markets.
XLRE is a focused S&P 500 real estate sector fund with a lower fee. Its performance depends on large U.S. real estate companies and domestic factors such as rent growth, occupancy, financing costs, and valuations. RWO offers exposure to listed real estate in developed and emerging markets, providing broader geographic diversification but with a higher expense ratio, currency risk, and regional property-market risk. Despite its global scope, RWO shares several top holdings with XLRE.
Before choosing between these two ETFs, investors should consider the role real estate should play in their portfolios. XLRE is a good fit for those who want a low-cost way to invest in the U.S. real estate sector through the S&P 500. RWO is better for investors who want more global real estate exposure and are comfortable with higher costs. Both funds react to changes in interest rates and property cycles, so the decision is not just about U.S. versus global, but also about choosing between lower-cost U.S. focus and wider exposure with extra regional and currency risks.
Should you buy stock in Select Sector SPDR Trust - State Street Real Estate Select Sector SPDR ETF right now?
Before you buy stock in Select Sector SPDR Trust - State Street Real Estate Select Sector SPDR ETF, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Select Sector SPDR Trust - State Street Real Estate Select Sector SPDR ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $417,305!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,293,148!*
Now, it’s worth noting Stock Advisor’s total average return is 936% — a market-crushing outperformance compared to 209% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of June 20, 2026.
Eric Trie has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
