IEMG vs XLY: Correlation & Overlap
iShares Core MSCI Emerging Markets ETF (IEMG) and Consumer Discretionary Select Sector SPDR Fund (XLY) show a moderate relationship: their 3-year correlation of weekly returns is 0.58. By holdings, the two funds overlap 0.0% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are IEMG and XLY?
Across a 3-year window, the weekly returns of IEMG and XLY correlate at 0.58, moderate. Little has changed lately, as the 1-year reading of 0.59 lands near the 3-year figure. Stretching to 5 years gives 0.57, with an annualized covariance of 199.7 %².
Among the 68 assets we track against IEMG, XLY ranks #44 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months IEMG outperformed by 36.1 percentage points (+36.0% for IEMG against -0.1% for XLY). The link looks structural: the rolling one-year correlation barely moved, holding between 0.46 and 0.70.
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 XLY: side by side
| IEMG (iShares Core MSCI Emerging Markets ETF) | XLY (Consumer Discretionary Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +36.0% | -0.1% |
| 5-year return | +50.7% | +31.8% |
| Volatility (ann.) | 17.4% | 19.7% |
| Beta vs S&P 500 | 0.84 | 1.15 |
| Max drawdown (3Y) | -17.2% | -26.0% |
| Dividend yield | 2.31% | 0.78% |
| Expense ratio | 0.09% | 0.08% |
| Assets under management | $152.2B | $22.5B |
| Sector / category | ETF · International | Sector ETF |
On the fund side, IEMG sits in the Diversified Emerging Mkts category at iShares, with $152.2B under management, 1824 holdings, a 0.09% expense ratio, a 2.31% trailing dividend yield. XLY is a Consumer Cyclical fund from State Street Investment Management: $22.5B under management, 47 holdings, a 0.08% expense ratio, a 0.78% trailing dividend yield.
Portfolio overlap between IEMG and XLY
The two portfolios are largely distinct: 0.0% of the funds' weight sits in the same underlying holdings (2 common positions). Correlation tells you they move together; overlap tells you why.
Largest positions held only by IEMG: 2330 (13.28%), 005930 (6.27%), 000660 (4.78%), 700 (2.49%), 9988 (1.77%). Only by XLY: AMZN (24.32%), TSLA (16.18%), HD (5.54%), MCD (4.11%), BKNG (4.04%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 2 common positions shown.
Year-by-year returns
| Year | IEMG | XLY |
|---|---|---|
| 2022 | -20.0% | -36.3% |
| 2023 | +11.5% | +39.6% |
| 2024 | +6.5% | +26.5% |
| 2025 | +32.6% | +7.4% |
| 2026 | +23.6% | -2.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEMG and XLY good diversifiers for each other?
Somewhat, no more. With 0.58 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between IEMG and XLY?
As of 2026-08-27, the correlation of weekly returns between IEMG and XLY is 0.58 over 3 years, 0.59 over 1 year and 0.57 over 5 years.
Is XLY a good diversifier for IEMG?
Somewhat, no more. With 0.58 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do IEMG and XLY overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0.0% by weight over 2 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/iemg-vs-xly.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/iemg-vs-xly/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: IEMG correlations · XLY correlations
