State Street Tech ETF Faces Off With Roundhill Generative AI Fund
Key Points
State Street Technology Select Sector SPDR ETF offers a significantly lower expense ratio of 0.08% compared to the 0.75% fee charged by Roundhill Generative AI & Technology ETF.
The Roundhill ETF has delivered a higher 98.2% total return over the past year but carries a higher beta of 1.84.
Roundhill's fund provides targeted global exposure to generative AI while the SPDR ETF focuses on broad U.S. information technology companies.
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State Street Technology Select Sector SPDR ETF (NYSEMKT:XLK) provides low-cost U.S. technology exposure, while Roundhill Generative AI & Technology ETF (NYSEMKT:CHAT) focuses on higher-cost, research-driven investments in the global generative artificial intelligence theme.
Investors seeking technology exposure may weigh a legacy sector fund against a thematic newcomer. XLK tracks a diversified index of U.S. tech giants, whereas CHAT targets the specific infrastructure and software driving the expansion of artificial intelligence across global markets.
Snapshot (cost & size)
| Metric | CHAT | XLK |
|---|---|---|
| Issuer | Roundhill Investments | SPDR |
| Share price (as of June 26, 2026) | $93.61 | $181.11 |
| Expense ratio | 0.75% | 0.08% |
| 1-yr return (as of June 26, 2026) | 98.2% | 45% |
| Dividend yield | 1.8% | 0.4% |
| Beta | 1.84 | 1.33 |
| AUM | $2 billion | $120.6 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 SPDR fund is significantly more affordable, offering a lower expense ratio than the Roundhill ETF. While CHAT charges a higher fee for its specialized thematic research, it currently offers a higher trailing dividend yield.
Performance & risk comparison
| Metric | CHAT | XLK |
|---|---|---|
| Max drawdown (3 yr) | (31.3%) | (25.7%) |
| Growth of $1,000 over 3 years (total return) | $3,358 | $2,164 |
What's inside
The SPDR ETF invests in U.S. companies within the information technology sector, utilizing a full replication technique to track its index. Its largest positions include Nvidia (NASDAQ:NVDA) at 14.8%, Apple (NASDAQ:AAPL) at 12.62%, and Microsoft (NASDAQ:MSFT) at 8.18%. The fund holds 74 stocks and was launched in 1998. The SPDR ETF has paid $0.79 per share over the trailing 12 months, which on its recent ~$181.11 share price works out to a 0.4% yield.
The Roundhill fund employs proprietary research to target global companies involved in AI software, cloud infrastructure, and semiconductors. Its top holdings include Nvidia at 6.34%, SK hynix at 5.45%, and Alphabet (NASDAQ:GOOGL) at 5.05%. The Roundhill ETF maintains 47 holdings and was launched in 2023. The fund has paid $1.68 per share over the trailing 12 months, which on its recent ~$93.61 share price works out to a 1.8% yield.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
It's a bit difficult to compare these two ETFs, as they're plainly quite different. One thing I want to want to highlight, however, is that CHAT's much higher expense ratio can probably be attributed to the fact that it's an actively managed fund. Conversely, XLK passively tracks an index, so it likely has considerably lower costs.
While XLK's performance trails that of CHAT, it's cheaper to own, carries a lower beta, and has much higher average trading volume, suggesting it's very liquid. Plus, XLK absolutely dwarfs CHAT in terms of assets under management. The SPDR fund is probably a more attractive choice for investors who tend to be more conservative.
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Erin Kennedy has positions in Apple. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
