EWJ vs XLP: Correlation & Overlap
iShares MSCI Japan ETF (EWJ) and Consumer Staples Select Sector SPDR Fund (XLP) show a moderate relationship: their 3-year correlation of weekly returns is 0.37. Looking through to holdings, 0% of the two portfolios is the same by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are EWJ and XLP?
Across a 3-year window, the weekly returns of EWJ and XLP correlate at 0.37, moderate. Recent behaviour matches the longer record: 0.31 over 1 year against 0.37 over 3. Stretching to 5 years gives 0.38, with an annualized covariance of 81.9 %².
Within EWJ's tracked universe of 70 assets, XLP comes in at #54 by 3-year correlation. Correlation aside, the last 12 months split them widely, with EWJ ahead by 18.8 points (+27.1% versus +8.3%). On a rolling one-year basis the correlation drifted between 0.20 and 0.57, a moderate band. One caveat on sizing: EWJ 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.
EWJ vs XLP: side by side
| EWJ (iShares MSCI Japan ETF) | XLP (Consumer Staples Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +27.1% | +8.3% |
| 5-year return | +58.6% | +34.7% |
| Volatility (ann.) | 19.6% | 11.1% |
| Beta vs S&P 500 | 0.94 | 0.23 |
| Max drawdown (3Y) | -14.7% | -9.7% |
| Dividend yield | 3.86% | 2.58% |
| Expense ratio | 0.49% | 0.08% |
| Assets under management | $21.8B | $14.6B |
| Sector / category | ETF · International | Sector ETF |
EWJ is a Japan Stock fund from iShares: $21.8B under management, 168 holdings, a 0.49% expense ratio, a 3.86% trailing dividend yield. 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.
Portfolio overlap between EWJ and XLP
The two portfolios are largely distinct, with 0 holdings in common adding up to 0% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
Largest positions held only by EWJ: 8306 (4.56%), 7203 (3.47%), 6857 (3.12%), 8035 (2.97%), 8316 (2.92%). Only by XLP: WMT (9.62%), COST (8.92%), KO (7.34%), PG (7.10%), PM (6.36%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26.
Year-by-year returns
| Year | EWJ | XLP |
|---|---|---|
| 2022 | -17.7% | -0.8% |
| 2023 | +20.3% | -0.8% |
| 2024 | +7.0% | +12.2% |
| 2025 | +25.8% | +1.5% |
| 2026 | +19.3% | +10.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are EWJ and XLP good diversifiers for each other?
Reasonably. At 0.37, EWJ and XLP keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between EWJ and XLP?
As of 2026-08-27, the correlation of weekly returns between EWJ and XLP is 0.37 over 3 years, 0.31 over 1 year and 0.38 over 5 years.
Is XLP a good diversifier for EWJ?
Reasonably. At 0.37, EWJ and XLP keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do EWJ and XLP overlap?
The two funds share 0 holdings amounting to 0% of weight, per issuer portfolio files dated 2026-08-26.
Use this data
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Hubs: EWJ correlations · XLP correlations
