IEF vs XLE: Correlation
iShares 7-10 Year Treasury Bond ETF (IEF) and Energy Select Sector SPDR Fund (XLE) show a negative relationship: their 3-year correlation of weekly returns is -0.21.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are IEF and XLE?
Over the past 3 years, IEF and XLE moved with a correlation of -0.21, which is negative, meaning they tend to move in opposite directions. The link has loosened recently: the 1-year correlation (-0.51) runs below the 3-year figure (-0.21). Over 5 years the correlation is -0.15, and the annualized covariance of weekly returns is -31.7 %².
Within IEF's tracked universe of 48 assets, XLE comes in at #22 by 3-year correlation. Correlation aside, the last 12 months split them widely, with XLE ahead by 43.1 points (+0.9% versus +44.0%). The relationship is regime-dependent: the rolling one-year correlation swung between -0.53 and 0.08 over the past three years, so this pair behaves very differently depending on the market environment. Risk is not evenly split, since XLE carries 3.6 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.
IEF vs XLE: side by side
| IEF (iShares 7-10 Year Treasury Bond ETF) | XLE (Energy Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +0.9% | +44.0% |
| 5-year return | -7.9% | +206.7% |
| Volatility (ann.) | 6.5% | 23.1% |
| Beta vs S&P 500 | 0.04 | 0.27 |
| Max drawdown (3Y) | -6.9% | -20.1% |
| Dividend yield | 3.96% | 2.55% |
| Expense ratio | 0.15% | 0.08% |
| Assets under management | $47.2B | $39.2B |
| Sector / category | ETF · Bonds | Sector ETF |
On the fund side, IEF sits in the Long Government category at iShares, with $47.2B under management, a 0.15% expense ratio, a 3.96% trailing dividend yield. XLE is an Equity Energy fund from State Street Investment Management: $39.2B under management, 22 holdings, a 0.08% expense ratio, a 2.55% trailing dividend yield.
Year-by-year returns
| Year | IEF | XLE |
|---|---|---|
| 2022 | -15.2% | +64.3% |
| 2023 | +3.6% | -0.6% |
| 2024 | -0.6% | +5.6% |
| 2025 | +8.0% | +7.9% |
| 2026 | -0.8% | +41.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEF and XLE good diversifiers for each other?
By historical standards, yes. A correlation of -0.21 means the two rarely move for the same reasons.
FAQ
What is the correlation between IEF and XLE?
The IEF/XLE correlation stands at -0.21 on a 3-year window (1 year: -0.51, 5 years: -0.15), computed from weekly returns as of 2026-08-27.
Is XLE a good diversifier for IEF?
By historical standards, yes. A correlation of -0.21 means the two rarely move for the same reasons.
What does a correlation of -0.21 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.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/ief-vs-xle.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/ief-vs-xle/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: IEF correlations · XLE correlations
