KMI vs XLE: Correlation
How closely do Kinder Morgan (KMI) and Energy Select Sector SPDR Fund (XLE) trade together? Their weekly returns over three years give a correlation of 0.63, which is strong.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are KMI and XLE?
Across a 3-year window, the weekly returns of KMI and XLE correlate at 0.63, strong. Recent behaviour matches the longer record: 0.61 over 1 year against 0.63 over 3. Stretching to 5 years gives 0.72, with an annualized covariance of 320.4 %².
Among the 33 assets we track against KMI, XLE ranks #13 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months XLE outperformed by 21.7 percentage points (+22.3% for KMI against +44.0% for XLE). The rolling one-year correlation moved between 0.36 and 0.82 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.
KMI vs XLE: side by side
| KMI (Kinder Morgan) | XLE (Energy Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +22.3% | +44.0% |
| 5-year return | +153.0% | +206.7% |
| Volatility (ann.) | 22.1% | 23.1% |
| Beta vs S&P 500 | 0.29 | 0.27 |
| Max drawdown (3Y) | -18.4% | -20.1% |
| Market cap | $70.2B | – |
| P/E (trailing) | 20.6 | – |
| Dividend yield | 3.69% | 2.55% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $39.2B |
| Sector / category | Energy | Sector ETF |
XLE is an Equity Energy fund from State Street Investment Management: $39.2B under management, 22 holdings, a 0.08% expense ratio, a 2.55% trailing dividend yield.
Year-by-year returns
| Year | KMI | XLE |
|---|---|---|
| 2022 | +21.2% | +64.3% |
| 2023 | +4.1% | -0.6% |
| 2024 | +64.4% | +5.6% |
| 2025 | +4.8% | +7.9% |
| 2026 | +18.0% | +41.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
KMI represents 3.72% of XLE's portfolio, so part of any move in XLE is KMI itself, and the correlation between them is partly mechanical.
Are KMI and XLE good diversifiers for each other?
Somewhat, no more. With 0.63 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between KMI and XLE?
Using weekly returns as of 2026-08-27: 0.63 over 3 years, with 0.61 over the last year and 0.72 over 5 years.
Is XLE a good diversifier for KMI?
Somewhat, no more. With 0.63 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.63 mean?
On the −1 to +1 scale, 0.63 describes how much the two returns move together: +1 is lockstep, 0 is independence, negative values mean opposite directions. It says nothing about which performed better.
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Related comparisons
Hubs: KMI correlations · XLE correlations
