ARE vs VNQ: Correlation
Alexandria Real Estate Equities (ARE) and Vanguard Real Estate ETF (VNQ) show a strong relationship: their 3-year correlation of weekly returns is 0.66.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are ARE and VNQ?
Across a 3-year window, the weekly returns of ARE and VNQ correlate at 0.66, strong. Lately the two have drifted apart, with the 1-year correlation at 0.51 versus 0.66 over 3 years. Stretching to 5 years gives 0.72, with an annualized covariance of 421.1 %².
VNQ is one of the assets that tracks ARE most closely: it ranks #2 out of the 34 assets we track against ARE. The last year tells two different stories: VNQ led by 42.4 percentage points, -32.1% for ARE against +10.3% for VNQ. Across three years, the rolling one-year figure varied moderately, from 0.54 to 0.89. Note the risk asymmetry: ARE runs 2.3 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
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.
ARE vs VNQ: side by side
| ARE (Alexandria Real Estate Equities) | VNQ (Vanguard Real Estate ETF) | |
|---|---|---|
| 1-year return | -32.1% | +10.3% |
| 5-year return | -68.3% | +9.5% |
| Volatility (ann.) | 38.3% | 16.6% |
| Beta vs S&P 500 | 0.91 | 0.59 |
| Max drawdown (3Y) | -65.6% | -17.5% |
| Market cap | $9.0B | – |
| P/E (trailing) | – | – |
| Dividend yield | 6.57% | 3.51% |
| Expense ratio | – | 0.13% |
| Assets under management | – | $73.1B |
| Sector / category | Real Estate | ETF · Real Estate |
VNQ is a Real Estate fund from Vanguard: $73.1B under management, 140 holdings, a 0.13% expense ratio, a 3.51% trailing dividend yield.
Year-by-year returns
| Year | ARE | VNQ |
|---|---|---|
| 2022 | -32.6% | -26.3% |
| 2023 | -9.1% | +11.9% |
| 2024 | -19.4% | +4.8% |
| 2025 | -46.6% | +3.2% |
| 2026 | +9.9% | +12.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
ARE represents 0.42% of VNQ's portfolio, so part of any move in VNQ is ARE itself, and the correlation between them is partly mechanical.
Are ARE and VNQ good diversifiers for each other?
To a limited degree. At 0.66 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between ARE and VNQ?
As of 2026-08-27, the correlation of weekly returns between ARE and VNQ is 0.66 over 3 years, 0.51 over 1 year and 0.72 over 5 years.
Is VNQ a good diversifier for ARE?
To a limited degree. At 0.66 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
What does a correlation of 0.66 mean?
A reading of 0.66 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/are-vs-vnq.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/are-vs-vnq/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: ARE correlations · VNQ correlations
