IEMG vs XLU: Correlation & Overlap
Measured on weekly returns over the past three years, iShares Core MSCI Emerging Markets ETF (IEMG) and Utilities Select Sector SPDR Fund (XLU) carry a correlation of 0.25, a weak link. Looking through to holdings, 0.0% 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 IEMG and XLU?
Over the past 3 years, IEMG and XLU moved with a correlation of 0.25, which is weak. The past 12 months show a weaker link (0.06) than the 3-year average (0.25). Over 5 years the correlation is 0.26, and the annualized covariance of weekly returns is 70.0 %².
Among the 68 assets we track against IEMG, XLU ranks #57 by 3-year correlation. The last year tells two different stories: IEMG led by 31.9 percentage points, +36.0% for IEMG against +4.1% for XLU. On a rolling one-year basis the correlation drifted between 0.06 and 0.47, a moderate band.
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.
IEMG vs XLU: side by side
| IEMG (iShares Core MSCI Emerging Markets ETF) | XLU (Utilities Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +36.0% | +4.1% |
| 5-year return | +50.7% | +46.3% |
| Volatility (ann.) | 17.4% | 15.8% |
| Beta vs S&P 500 | 0.84 | 0.26 |
| Max drawdown (3Y) | -17.2% | -13.1% |
| Dividend yield | 2.31% | 2.70% |
| Expense ratio | 0.09% | 0.08% |
| Assets under management | $152.2B | $23.1B |
| Sector / category | ETF · International | Sector ETF |
IEMG is a Diversified Emerging Mkts fund from iShares: $152.2B under management, 1824 holdings, a 0.09% expense ratio, a 2.31% trailing dividend yield. XLU is an Utilities fund from State Street Investment Management: $23.1B under management, 31 holdings, a 0.08% expense ratio, a 2.70% trailing dividend yield.
Portfolio overlap between IEMG and XLU
The two portfolios are largely distinct, with 1 holdings in common adding up to 0.0% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
| Common holding | Weight in IEMG | Weight in XLU |
|---|---|---|
| SRE | 0.01% | 4.11% |
Largest positions held only by IEMG: 2330 (13.28%), 005930 (6.27%), 000660 (4.78%), 700 (2.49%), 9988 (1.77%). Only by XLU: NEE (12.94%), SO (7.45%), DUK (7.00%), CEG (6.58%), AEP (4.94%).
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 | IEMG | XLU |
|---|---|---|
| 2022 | -20.0% | +1.4% |
| 2023 | +11.5% | -7.2% |
| 2024 | +6.5% | +23.3% |
| 2025 | +32.6% | +16.0% |
| 2026 | +23.6% | +2.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEMG and XLU good diversifiers for each other?
Reasonably. At 0.25, IEMG and XLU keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between IEMG and XLU?
As of 2026-08-27, the correlation of weekly returns between IEMG and XLU is 0.25 over 3 years, 0.06 over 1 year and 0.26 over 5 years.
Is XLU a good diversifier for IEMG?
Reasonably. At 0.25, IEMG and XLU keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do IEMG and XLU overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.0% by weight over 1 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/iemg-vs-xlu.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/iemg-vs-xlu/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: IEMG correlations · XLU correlations
