HYG vs NLY: Correlation
How closely do iShares iBoxx High Yield Corporate Bond ETF (HYG) and Annaly Capital Management Inc. (NLY) trade together? Their weekly returns over three years give a correlation of 0.73, which is strong.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are HYG and NLY?
Over the past 3 years, HYG and NLY moved with a correlation of 0.73, which is strong. The relationship has been stable: the 1-year correlation (0.65) sits close to the 3-year figure. Over 5 years the correlation is 0.63, and the annualized covariance of weekly returns is 79.1 %².
Within HYG's tracked universe of 46 assets, NLY comes in at #14 by 3-year correlation. The last year tells two different stories: NLY led by 20.8 percentage points, +4.6% for HYG against +25.4% for NLY. Risk is not evenly split, since NLY carries 4.9 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 NLY: side by side
| HYG (iShares iBoxx High Yield Corporate Bond ETF) | NLY (Annaly Capital Management Inc.) | |
|---|---|---|
| 1-year return | +4.6% | +25.4% |
| 5-year return | +19.9% | +30.4% |
| Volatility (ann.) | 4.7% | 22.9% |
| Beta vs S&P 500 | 0.22 | 0.81 |
| Max drawdown (3Y) | -4.6% | -26.3% |
| Market cap | – | $17.4B |
| P/E (trailing) | – | 5.6 |
| Dividend yield | 5.94% | 12.47% |
| Expense ratio | 0.49% | – |
| Assets under management | $17.1B | – |
| Sector / category | ETF · Bonds | US Listed |
HYG is a High Yield Bond fund from iShares: $17.1B under management, a 0.49% expense ratio, a 5.94% trailing dividend yield.
Year-by-year returns
| Year | HYG | NLY |
|---|---|---|
| 2022 | -11.0% | -21.4% |
| 2023 | +11.5% | +4.9% |
| 2024 | +8.0% | +8.1% |
| 2025 | +8.6% | +40.0% |
| 2026 | +2.5% | +10.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are HYG and NLY good diversifiers for each other?
To a limited degree. At 0.73 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 HYG and NLY?
As of 2026-08-27, the correlation of weekly returns between HYG and NLY is 0.73 over 3 years, 0.65 over 1 year and 0.63 over 5 years.
Is NLY a good diversifier for HYG?
To a limited degree. At 0.73 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 0.73 mean?
A reading of 0.73 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-nly.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/hyg-vs-nly/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: HYG correlations · NLY correlations
