COST vs XLP: Correlation
Costco (COST) and Consumer Staples Select Sector SPDR Fund (XLP) show a moderate relationship: their 3-year correlation of weekly returns is 0.53.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are COST and XLP?
Over the past 3 years, COST and XLP moved with a correlation of 0.53, which is moderate. Lately the two have moved closer together, with the 1-year correlation at 0.67 versus 0.53 over 3 years. Over 5 years the correlation is 0.62, and the annualized covariance of weekly returns is 116.2 %².
XLP is one of the assets that tracks COST most closely: it ranks #2 out of the 33 assets we track against COST. The trailing year gives XLP the advantage: -1.0% versus +8.3%, a 9.3-point spread. Across three years, the rolling one-year figure varied moderately, from 0.28 to 0.69. One caveat on sizing: COST is 1.8 times as volatile as the other leg, so an equal-dollar split is far from equal-risk.
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.
COST vs XLP: side by side
| COST (Costco) | XLP (Consumer Staples Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | -1.0% | +8.3% |
| 5-year return | +116.3% | +34.7% |
| Volatility (ann.) | 19.8% | 11.1% |
| Beta vs S&P 500 | 0.45 | 0.23 |
| Max drawdown (3Y) | -20.7% | -9.7% |
| Market cap | $414.5B | – |
| P/E (trailing) | 48.1 | – |
| Dividend yield | 0.56% | 2.58% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $14.6B |
| Sector / category | Consumer Staples | Sector ETF |
On the fund side, XLP sits in the Consumer Defensive category at State Street Investment Management, with $14.6B under management, 35 holdings, a 0.08% expense ratio, a 2.58% trailing dividend yield.
Year-by-year returns
| Year | COST | XLP |
|---|---|---|
| 2022 | -19.0% | -0.8% |
| 2023 | +49.0% | -0.8% |
| 2024 | +39.6% | +12.2% |
| 2025 | -5.4% | +1.5% |
| 2026 | +8.9% | +10.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
A structural note: 8.92% of XLP is COST itself, so the fund partly moves with the stock by construction.
Are COST and XLP good diversifiers for each other?
To a limited degree. At 0.53 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 COST and XLP?
Using weekly returns as of 2026-08-27: 0.53 over 3 years, with 0.67 over the last year and 0.62 over 5 years.
Is XLP a good diversifier for COST?
To a limited degree. At 0.53 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 0.53 mean?
On the −1 to +1 scale, 0.53 describes how much the two returns move together: +1 is lockstep, 0 is independence, negative values mean opposite directions. It says nothing about which performed better.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/cost-vs-xlp.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/cost-vs-xlp/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: COST correlations · XLP correlations
