MTUM vs XLP: Correlation & Overlap
How closely do iShares MSCI USA Momentum Factor ETF (MTUM) and Consumer Staples Select Sector SPDR Fund (XLP) trade together? Their weekly returns over three years give a correlation of 0.20, which is weak. Looking through to holdings, 3.9% 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 MTUM and XLP?
Across a 3-year window, the weekly returns of MTUM and XLP correlate at 0.20, weak. The past 12 months show a weaker link (-0.02) than the 3-year average (0.20). Stretching to 5 years gives 0.41, with an annualized covariance of 45.4 %².
Within MTUM's tracked universe of 109 assets, XLP comes in at #98 by 3-year correlation. The last year tells two different stories: MTUM led by 16.9 percentage points, +25.2% for MTUM against +8.3% for XLP. The relationship is regime-dependent: the rolling one-year correlation swung between -0.03 and 0.66 over the past three years, so this pair behaves very differently depending on the market environment. One caveat on sizing: MTUM is 1.9 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.
MTUM vs XLP: side by side
| MTUM (iShares MSCI USA Momentum Factor ETF) | XLP (Consumer Staples Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +25.2% | +8.3% |
| 5-year return | +76.1% | +34.7% |
| Volatility (ann.) | 20.6% | 11.1% |
| Beta vs S&P 500 | 1.25 | 0.23 |
| Max drawdown (3Y) | -21.0% | -9.7% |
| Dividend yield | 0.62% | 2.58% |
| Expense ratio | 0.15% | 0.08% |
| Assets under management | $25.3B | $14.6B |
| Sector / category | ETF · US Style | Sector ETF |
MTUM, iShares's Large Blend fund, carries $25.3B under management, 126 holdings, a 0.15% expense ratio, a 0.62% trailing dividend yield. On the fund side, XLP sits in the Consumer Defensive category at State Street Investment Management, with $14.6B under management, 35 holdings, a 0.08% expense ratio, a 2.58% trailing dividend yield.
Portfolio overlap between MTUM and XLP
The two portfolios are largely distinct: 3.9% of the funds' weight sits in the same underlying holdings (6 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in MTUM | Weight in XLP |
|---|---|---|
| WMT | 2.44% | 9.62% |
| MO | 0.59% | 4.21% |
| TGT | 0.36% | 4.67% |
| CASY | 0.23% | 1.87% |
| ADM | 0.17% | 2.42% |
| BG | 0.08% | 0.96% |
Largest positions held only by MTUM: MU (6.60%), AMD (5.09%), AVGO (4.25%), INTC (3.91%), XOM (3.78%). Only by XLP: COST (8.92%), KO (7.34%), PG (7.10%), PM (6.36%), CL (4.56%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 6 common positions shown.
Year-by-year returns
| Year | MTUM | XLP |
|---|---|---|
| 2022 | -18.3% | -0.8% |
| 2023 | +9.1% | -0.8% |
| 2024 | +32.9% | +12.2% |
| 2025 | +22.1% | +1.5% |
| 2026 | +21.8% | +10.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are MTUM and XLP good diversifiers for each other?
Reasonably. At 0.20, MTUM and XLP keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between MTUM and XLP?
The MTUM/XLP correlation stands at 0.20 on a 3-year window (1 year: -0.02, 5 years: 0.41), computed from weekly returns as of 2026-08-27.
Is XLP a good diversifier for MTUM?
Reasonably. At 0.20, MTUM and XLP keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do MTUM and XLP overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 3.9% by weight over 6 common positions.
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