DHI vs XLY: Correlation
Measured on weekly returns over the past three years, D. R. Horton (DHI) and Consumer Discretionary Select Sector SPDR Fund (XLY) carry a correlation of 0.38, a moderate link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are DHI and XLY?
Across a 3-year window, the weekly returns of DHI and XLY correlate at 0.38, moderate. The relationship has been stable: the 1-year correlation (0.38) sits close to the 3-year figure. Stretching to 5 years gives 0.47, with an annualized covariance of 253.0 %².
By 3-year correlation, XLY places #19 of the 31 assets tracked against DHI. The trailing year gives XLY the advantage: -12.2% versus -0.1%, a 12.1-point spread. The relationship is regime-dependent: the rolling one-year correlation swung between 0.14 and 0.74 over the past three years, so this pair behaves very differently depending on the market environment. Note the risk asymmetry: DHI runs 1.7 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.
DHI vs XLY: side by side
| DHI (D. R. Horton) | XLY (Consumer Discretionary Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | -12.2% | -0.1% |
| 5-year return | +59.2% | +31.8% |
| Volatility (ann.) | 33.5% | 19.7% |
| Beta vs S&P 500 | 0.79 | 1.15 |
| Max drawdown (3Y) | -41.3% | -26.0% |
| Market cap | $40.6B | – |
| P/E (trailing) | 14.2 | – |
| Dividend yield | 1.17% | 0.78% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $22.5B |
| Sector / category | Consumer Discretionary | Sector ETF |
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.
Year-by-year returns
| Year | DHI | XLY |
|---|---|---|
| 2022 | -16.8% | -36.3% |
| 2023 | +72.1% | +39.6% |
| 2024 | -7.2% | +26.5% |
| 2025 | +4.2% | +7.4% |
| 2026 | +1.8% | -2.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
Keep in mind that XLY holds DHI at a 0.98% weight, which makes a slice of this correlation mechanical rather than coincidental.
Are DHI and XLY good diversifiers for each other?
A fair diversifier. At 0.38, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
FAQ
What is the correlation between DHI and XLY?
Using weekly returns as of 2026-08-27: 0.38 over 3 years, with 0.38 over the last year and 0.47 over 5 years.
Is XLY a good diversifier for DHI?
A fair diversifier. At 0.38, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
What does a correlation of 0.38 mean?
Correlation ranges from −1 to +1. Values near +1 mean two assets move together, near 0 that they move independently, and negative values that they tend to move in opposite directions. It measures co-movement, not performance.
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Related comparisons
Hubs: DHI correlations · XLY correlations
