ACWI vs XLY: Correlation & Overlap
iShares MSCI ACWI ETF (ACWI) and Consumer Discretionary Select Sector SPDR Fund (XLY) show a very strong relationship: their 3-year correlation of weekly returns is 0.83. By holdings, the two funds overlap 5.8% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are ACWI and XLY?
Over the past 3 years, ACWI and XLY moved with a correlation of 0.83, which is very strong, meaning they move nearly in lockstep. The relationship has been stable: the 1-year correlation (0.79) sits close to the 3-year figure. Over 5 years the correlation is 0.85, and the annualized covariance of weekly returns is 223.5 %².
Within ACWI's tracked universe of 119 assets, XLY comes in at #35 by 3-year correlation. The last year tells two different stories: ACWI led by 22.8 percentage points, +22.7% for ACWI against -0.1% for XLY. The link looks structural: the rolling one-year correlation barely moved, holding between 0.80 and 0.87.
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 XLY: side by side
| ACWI (iShares MSCI ACWI ETF) | XLY (Consumer Discretionary Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +22.7% | -0.1% |
| 5-year return | +69.0% | +31.8% |
| Volatility (ann.) | 13.8% | 19.7% |
| Beta vs S&P 500 | 0.92 | 1.15 |
| Max drawdown (3Y) | -16.5% | -26.0% |
| Dividend yield | 1.44% | 0.78% |
| Expense ratio | 0.32% | 0.08% |
| Assets under management | $32.5B | $22.5B |
| Sector / category | ETF · Global | Sector ETF |
On the fund side, ACWI sits in the Global Large-Stock Blend category at iShares, with $32.5B under management, 1590 holdings, a 0.32% expense ratio, a 1.44% trailing dividend yield. XLY is a Consumer Cyclical fund from State Street Investment Management: $22.5B under management, 47 holdings, a 0.08% expense ratio, a 0.78% trailing dividend yield.
Portfolio overlap between ACWI and XLY
The two portfolios are largely distinct. Weighing the shared positions, 5.8% of the two funds is identical, spread across 42 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in ACWI | Weight in XLY |
|---|---|---|
| AMZN | 2.41% | 24.32% |
| TSLA | 0.93% | 16.18% |
| HD | 0.32% | 5.54% |
| MCD | 0.18% | 4.11% |
| BKNG | 0.16% | 4.04% |
| TJX | 0.14% | 3.55% |
| SBUX | 0.12% | 3.08% |
| LOW | 0.11% | 2.94% |
| GM | 0.08% | 1.94% |
| MAR | 0.08% | 1.96% |
| ABNB | 0.08% | 1.96% |
| DASH | 0.08% | 2.24% |
| ORLY | 0.07% | 1.85% |
| HLT | 0.07% | 1.89% |
| ROST | 0.07% | 1.90% |
Largest positions held only by ACWI: NVDA (4.64%), AAPL (4.41%), MSFT (3.35%), GOOGL (1.91%), 2330 (1.79%). Only by XLY: RL (0.35%), HAS (0.32%), MGM (0.21%), WYNN (0.20%), NCLH (0.20%).
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 | XLY |
|---|---|---|
| 2022 | -18.4% | -36.3% |
| 2023 | +22.3% | +39.6% |
| 2024 | +17.4% | +26.5% |
| 2025 | +22.4% | +7.4% |
| 2026 | +14.9% | -2.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are ACWI and XLY good diversifiers for each other?
No. With a correlation of 0.83, ACWI and XLY move nearly in lockstep, so holding both adds very little diversification.
FAQ
What is the correlation between ACWI and XLY?
As of 2026-08-27, the correlation of weekly returns between ACWI and XLY is 0.83 over 3 years, 0.79 over 1 year and 0.85 over 5 years.
Is XLY a good diversifier for ACWI?
No. With a correlation of 0.83, ACWI and XLY move nearly in lockstep, so holding both adds very little diversification.
How much do ACWI and XLY overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 5.8% by weight over 42 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/acwi-vs-xly.json
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Related comparisons
Hubs: ACWI correlations · XLY correlations
