ACWI vs XLF: Correlation & Overlap
Measured on weekly returns over the past three years, iShares MSCI ACWI ETF (ACWI) and Financial Select Sector SPDR Fund (XLF) carry a correlation of 0.72, a strong link. By holdings, the two funds overlap 7.7% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are ACWI and XLF?
On 3 years of weekly data the ACWI/XLF correlation comes out at 0.72, strong. Lately the two have drifted apart, with the 1-year correlation at 0.54 versus 0.72 over 3 years. The 5-year figure is 0.79, and annualized covariance runs at 161.4 %².
Among the 119 assets we track against ACWI, XLF ranks #56 by 3-year correlation. The trailing year gives ACWI the advantage: +22.7% versus +9.3%, a 13.4-point spread. Across three years, the rolling one-year figure varied moderately, from 0.53 to 0.86.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
ACWI vs XLF: side by side
| ACWI (iShares MSCI ACWI ETF) | XLF (Financial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +22.7% | +9.3% |
| 5-year return | +69.0% | +64.2% |
| Volatility (ann.) | 13.8% | 16.2% |
| Beta vs S&P 500 | 0.92 | 0.84 |
| Max drawdown (3Y) | -16.5% | -15.5% |
| Dividend yield | 1.44% | 1.42% |
| Expense ratio | 0.32% | 0.08% |
| Assets under management | $32.5B | $57.9B |
| Sector / category | ETF · Global | Sector ETF |
ACWI, iShares's Global Large-Stock Blend fund, carries $32.5B under management, 1590 holdings, a 0.32% expense ratio, a 1.44% trailing dividend yield. XLF is a Financial fund from State Street Investment Management: $57.9B under management, 77 holdings, a 0.08% expense ratio, a 1.42% trailing dividend yield.
Portfolio overlap between ACWI and XLF
The two portfolios are largely distinct: 7.7% of the funds' weight sits in the same underlying holdings (70 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in ACWI | Weight in XLF |
|---|---|---|
| JPM | 0.92% | 11.61% |
| BRK.B | 0.67% | 11.25% |
| V | 0.62% | 7.74% |
| MA | 0.47% | 5.87% |
| BAC | 0.40% | 4.94% |
| GS | 0.30% | 3.73% |
| WFC | 0.25% | 3.17% |
| MS | 0.24% | 3.12% |
| C | 0.22% | 2.77% |
| SCHW | 0.17% | 2.17% |
| AXP | 0.17% | 2.17% |
| BLK | 0.16% | 2.06% |
| SPGI | 0.13% | 1.61% |
| CB | 0.12% | 1.51% |
| PGR | 0.12% | 1.58% |
Largest positions held only by ACWI: NVDA (4.64%), AAPL (4.41%), MSFT (3.35%), AMZN (2.41%), GOOGL (1.91%). Only by XLF: IVZ (0.18%), AIZ (0.17%), GL (0.17%), JKHY (0.15%), FDS (0.13%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 15 common positions shown.
Year-by-year returns
| Year | ACWI | XLF |
|---|---|---|
| 2022 | -18.4% | -10.6% |
| 2023 | +22.3% | +12.0% |
| 2024 | +17.4% | +30.6% |
| 2025 | +22.4% | +14.9% |
| 2026 | +14.9% | +6.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are ACWI and XLF good diversifiers for each other?
Somewhat, no more. With 0.72 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between ACWI and XLF?
As of 2026-08-27, the correlation of weekly returns between ACWI and XLF is 0.72 over 3 years, 0.54 over 1 year and 0.79 over 5 years.
Is XLF a good diversifier for ACWI?
Somewhat, no more. With 0.72 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do ACWI and XLF overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 7.7% by weight over 70 common positions.
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