IWM vs LMND: Correlation
How closely do iShares Russell 2000 ETF (IWM) and Lemonade, Inc. (LMND) trade together? Their weekly returns over three years give a correlation of 0.49, which is moderate.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are IWM and LMND?
On 3 years of weekly data the IWM/LMND correlation comes out at 0.49, moderate. Lately the two have drifted apart, with the 1-year correlation at 0.28 versus 0.49 over 3 years. The 5-year figure is 0.55, and annualized covariance runs at 820.6 %².
Within IWM's tracked universe of 320 assets, LMND comes in at #245 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months IWM outperformed by 28.5 percentage points (+28.4% for IWM against -0.1% for LMND). One caveat on sizing: LMND is 4.3 times as volatile as the other leg, so an equal-dollar split is far from equal-risk.
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.
IWM vs LMND: side by side
| IWM (iShares Russell 2000 ETF) | LMND (Lemonade, Inc.) | |
|---|---|---|
| 1-year return | +28.4% | -0.1% |
| 5-year return | +41.5% | -28.5% |
| Volatility (ann.) | 19.8% | 84.2% |
| Beta vs S&P 500 | 1.06 | 2.01 |
| Max drawdown (3Y) | -27.5% | -51.5% |
| Market cap | – | $4.2B |
| P/E (trailing) | – | – |
| Dividend yield | 0.91% | 0.00% |
| Expense ratio | 0.19% | – |
| Assets under management | $80.1B | – |
| Sector / category | ETF · US Small & Mid Cap | US Listed |
IWM, iShares's Small Blend fund, carries $80.1B under management, 1757 holdings, a 0.19% expense ratio, a 0.91% trailing dividend yield.
Year-by-year returns
| Year | IWM | LMND |
|---|---|---|
| 2022 | -20.5% | -67.5% |
| 2023 | +16.8% | +17.9% |
| 2024 | +11.4% | +127.4% |
| 2025 | +12.7% | +94.1% |
| 2026 | +22.3% | -24.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
Keep in mind that IWM holds LMND at a 0.12% weight, which makes a slice of this correlation mechanical rather than coincidental.
Are IWM and LMND good diversifiers for each other?
Reasonably. At 0.49, IWM and LMND keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between IWM and LMND?
Using weekly returns as of 2026-08-27: 0.49 over 3 years, with 0.28 over the last year and 0.55 over 5 years.
Is LMND a good diversifier for IWM?
Reasonably. At 0.49, IWM and LMND keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
What does a correlation of 0.49 mean?
A reading of 0.49 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/iwm-vs-lmnd.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/iwm-vs-lmnd/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: IWM correlations · LMND correlations
