HYG vs IWM: Correlation
How closely do iShares iBoxx High Yield Corporate Bond ETF (HYG) and iShares Russell 2000 ETF (IWM) trade together? Their weekly returns over three years give a correlation of 0.74, which is strong.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are HYG and IWM?
Across a 3-year window, the weekly returns of HYG and IWM correlate at 0.74, strong. Recent behaviour matches the longer record: 0.79 over 1 year against 0.74 over 3. Stretching to 5 years gives 0.74, with an annualized covariance of 69.0 %².
Within HYG's tracked universe of 46 assets, IWM comes in at #9 by 3-year correlation. Correlation aside, the last 12 months split them widely, with IWM ahead by 23.8 points (+4.6% versus +28.4%). The rolling one-year correlation stayed in a tight band between 0.63 and 0.84 over the past three years, which points to a structural rather than episodic relationship. Risk is not evenly split, since IWM carries 4.2 times the volatility of the other side.
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.
HYG vs IWM: side by side
| HYG (iShares iBoxx High Yield Corporate Bond ETF) | IWM (iShares Russell 2000 ETF) | |
|---|---|---|
| 1-year return | +4.6% | +28.4% |
| 5-year return | +19.9% | +41.5% |
| Volatility (ann.) | 4.7% | 19.8% |
| Beta vs S&P 500 | 0.22 | 1.06 |
| Max drawdown (3Y) | -4.6% | -27.5% |
| Dividend yield | 5.94% | 0.91% |
| Expense ratio | 0.49% | 0.19% |
| Assets under management | $17.1B | $80.1B |
| Sector / category | ETF · Bonds | ETF · US Small & Mid Cap |
HYG, iShares's High Yield Bond fund, carries $17.1B under management, a 0.49% expense ratio, a 5.94% trailing dividend yield. IWM, iShares's Small Blend fund, carries $80.1B under management, 1757 holdings, a 0.19% expense ratio, a 0.91% trailing dividend yield.
Year-by-year returns
| Year | HYG | IWM |
|---|---|---|
| 2022 | -11.0% | -20.5% |
| 2023 | +11.5% | +16.8% |
| 2024 | +8.0% | +11.4% |
| 2025 | +8.6% | +12.7% |
| 2026 | +2.5% | +22.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are HYG and IWM good diversifiers for each other?
Somewhat, no more. With 0.74 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between HYG and IWM?
The HYG/IWM correlation stands at 0.74 on a 3-year window (1 year: 0.79, 5 years: 0.74), computed from weekly returns as of 2026-08-27.
Is IWM a good diversifier for HYG?
Somewhat, no more. With 0.74 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.74 mean?
A reading of 0.74 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/hyg-vs-iwm.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/hyg-vs-iwm/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: HYG correlations · IWM correlations
