IEFA vs XLV: Correlation & Overlap
How closely do iShares Core MSCI EAFE ETF (IEFA) and Health Care Select Sector SPDR Fund (XLV) trade together? Their weekly returns over three years give a correlation of 0.52, which is moderate. The two funds also share 0.1% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are IEFA and XLV?
Across a 3-year window, the weekly returns of IEFA and XLV correlate at 0.52, moderate. The link has loosened recently: the 1-year correlation (0.36) runs below the 3-year figure (0.52). Stretching to 5 years gives 0.56, with an annualized covariance of 113.6 %².
Within IEFA's tracked universe of 111 assets, XLV comes in at #87 by 3-year correlation. Over the last 12 months XLV came out ahead by 5.7 percentage points (+21.8% against +27.5%). The rolling one-year correlation moved between 0.40 and 0.66 over the past three years, a moderate range.
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.
IEFA vs XLV: side by side
| IEFA (iShares Core MSCI EAFE ETF) | XLV (Health Care Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +21.8% | +27.5% |
| 5-year return | +54.5% | +37.4% |
| Volatility (ann.) | 15.0% | 14.7% |
| Beta vs S&P 500 | 0.77 | 0.42 |
| Max drawdown (3Y) | -13.8% | -17.1% |
| Dividend yield | 3.35% | 1.56% |
| Expense ratio | 0.07% | 0.08% |
| Assets under management | $190.1B | $41.7B |
| Sector / category | ETF · International | Sector ETF |
IEFA is a Foreign Large Blend fund from iShares: $190.1B under management, 1620 holdings, a 0.07% expense ratio, a 3.35% 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 IEFA and XLV
The two portfolios are largely distinct. Weighing the shared positions, 0.1% of the two funds is identical, spread across 1 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in IEFA | Weight in XLV |
|---|---|---|
| MRK | 0.08% | 6.04% |
Largest positions held only by IEFA: ASML (2.57%), HSBA (1.35%), ROP (1.22%), SAN (1.17%), NOVN (1.10%). Only by XLV: LLY (15.03%), JNJ (10.38%), ABBV (7.42%), UNH (5.82%), AMGN (3.80%).
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 | IEFA | XLV |
|---|---|---|
| 2022 | -15.2% | -2.1% |
| 2023 | +18.0% | +2.1% |
| 2024 | +3.3% | +2.5% |
| 2025 | +32.1% | +14.5% |
| 2026 | +14.5% | +11.8% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEFA and XLV good diversifiers for each other?
Somewhat, no more. With 0.52 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between IEFA and XLV?
As of 2026-08-27, the correlation of weekly returns between IEFA and XLV is 0.52 over 3 years, 0.36 over 1 year and 0.56 over 5 years.
Is XLV a good diversifier for IEFA?
Somewhat, no more. With 0.52 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do IEFA and XLV overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.1% by weight over 1 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/iefa-vs-xlv.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/iefa-vs-xlv/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: IEFA correlations · XLV correlations
