IWM vs SPY: Correlation & Overlap
Measured on weekly returns over the past three years, iShares Russell 2000 ETF (IWM) and SPDR S&P 500 ETF Trust (SPY) carry a correlation of 0.77, a strong link. Looking through to holdings, 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 IWM and SPY?
Across a 3-year window, the weekly returns of IWM and SPY correlate at 0.77, strong. Little has changed lately, as the 1-year reading of 0.73 lands near the 3-year figure. Stretching to 5 years gives 0.83, with an annualized covariance of 222.0 %².
By 3-year correlation, SPY places #22 of the 320 assets tracked against IWM. Over the last 12 months IWM came out ahead by 7.8 percentage points (+28.4% against +20.6%). On a rolling one-year basis the correlation drifted between 0.61 and 0.89, 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.
IWM vs SPY: side by side
| IWM (iShares Russell 2000 ETF) | SPY (SPDR S&P 500 ETF Trust) | |
|---|---|---|
| 1-year return | +28.4% | +20.6% |
| 5-year return | +41.5% | +82.4% |
| Volatility (ann.) | 19.8% | 14.5% |
| Beta vs S&P 500 | 1.06 | 1.00 |
| Max drawdown (3Y) | -27.5% | -18.8% |
| Dividend yield | 0.91% | 1.01% |
| Expense ratio | 0.19% | 0.09% |
| Assets under management | $80.1B | $795.3B |
| Sector / category | ETF · US Small & Mid Cap | ETF · US Large Cap |
On the fund side, IWM sits in the Small Blend category at iShares, with $80.1B under management, 1757 holdings, a 0.19% expense ratio, a 0.91% trailing dividend yield. SPY is a Large Blend fund from State Street Investment Management: $795.3B under management, 504 holdings, a 0.09% expense ratio, a 1.01% trailing dividend yield.
Portfolio overlap between IWM and SPY
The two portfolios are largely distinct, with 0 holdings in common adding up to 0% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
Largest positions held only by IWM: MOGA (0.35%), UMBF (0.34%), CYTK (0.33%), GKOS (0.33%), EAT (0.33%). Only by SPY: NVDA (7.68%), AAPL (6.96%), MSFT (5.58%), AMZN (3.85%), GOOGL (3.03%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26.
Year-by-year returns
| Year | IWM | SPY |
|---|---|---|
| 2022 | -20.5% | -18.2% |
| 2023 | +16.8% | +26.2% |
| 2024 | +11.4% | +24.9% |
| 2025 | +12.7% | +17.7% |
| 2026 | +22.3% | +13.7% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IWM and SPY good diversifiers for each other?
To a limited degree. At 0.77 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between IWM and SPY?
Using weekly returns as of 2026-08-27: 0.77 over 3 years, with 0.73 over the last year and 0.83 over 5 years.
Is SPY a good diversifier for IWM?
To a limited degree. At 0.77 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
How much do IWM and SPY overlap?
0% by weight, across 0 common holdings, based on issuer-disclosed portfolios as of 2026-08-26.
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Hubs: IWM correlations · SPY correlations
