EEM vs XLV: Correlation & Overlap
iShares MSCI Emerging Markets ETF (EEM) and Health Care Select Sector SPDR Fund (XLV) show a weak relationship: their 3-year correlation of weekly returns is 0.26. By holdings, the two funds overlap 0.0% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are EEM and XLV?
Over the past 3 years, EEM and XLV moved with a correlation of 0.26, which is weak. The past 12 months show a weaker link (0.03) than the 3-year average (0.26). Over 5 years the correlation is 0.31, and the annualized covariance of weekly returns is 67.6 %².
Among the 67 assets we track against EEM, XLV ranks #54 by 3-year correlation. On 12-month performance EEM holds a 10.6-point edge, +38.1% against +27.5%. The relationship is regime-dependent: the rolling one-year correlation swung between 0.04 and 0.56 over the past three years, so this pair behaves very differently depending on the market environment.
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.
EEM vs XLV: side by side
| EEM (iShares MSCI Emerging Markets ETF) | XLV (Health Care Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +38.1% | +27.5% |
| 5-year return | +47.1% | +37.4% |
| Volatility (ann.) | 18.0% | 14.7% |
| Beta vs S&P 500 | 0.85 | 0.42 |
| Max drawdown (3Y) | -17.3% | -17.1% |
| Dividend yield | 1.73% | 1.56% |
| Expense ratio | 0.72% | 0.08% |
| Assets under management | $29.2B | $41.7B |
| Sector / category | ETF · International | Sector ETF |
EEM, iShares's Diversified Emerging Mkts fund, carries $29.2B under management, 968 holdings, a 0.72% expense ratio, a 1.73% trailing dividend yield. On the fund side, XLV sits in the Health category at State Street Investment Management, with $41.7B under management, 61 holdings, a 0.08% expense ratio, a 1.56% trailing dividend yield.
Portfolio overlap between EEM and XLV
The two portfolios are largely distinct: 0.0% of the funds' weight sits in the same underlying holdings (1 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in EEM | Weight in XLV |
|---|---|---|
| BDX | 0.02% | 0.84% |
Largest positions held only by EEM: 2330 (15.14%), 005930 (7.15%), 000660 (5.45%), 700 (2.83%), 9988 (2.02%). Only by XLV: LLY (15.03%), JNJ (10.38%), ABBV (7.42%), MRK (6.04%), UNH (5.82%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 1 common positions shown.
Year-by-year returns
| Year | EEM | XLV |
|---|---|---|
| 2022 | -20.6% | -2.1% |
| 2023 | +8.9% | +2.1% |
| 2024 | +6.5% | +2.5% |
| 2025 | +34.0% | +14.5% |
| 2026 | +24.2% | +11.8% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EEM and XLV good diversifiers for each other?
A fair diversifier. At 0.26, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
FAQ
What is the correlation between EEM and XLV?
As of 2026-08-27, the correlation of weekly returns between EEM and XLV is 0.26 over 3 years, 0.03 over 1 year and 0.31 over 5 years.
Is XLV a good diversifier for EEM?
A fair diversifier. At 0.26, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
How much do EEM and XLV overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.0% by weight over 1 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/eem-vs-xlv.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/eem-vs-xlv/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: EEM correlations · XLV correlations
