PFG vs XLF: Correlation
How closely do Principal Financial Group (PFG) and Financial Select Sector SPDR Fund (XLF) trade together? Their weekly returns over three years give a correlation of 0.73, which is strong.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are PFG and XLF?
On 3 years of weekly data the PFG/XLF correlation comes out at 0.73, strong. The link has loosened recently: the 1-year correlation (0.58) runs below the 3-year figure (0.73). The 5-year figure is 0.79, and annualized covariance runs at 271.2 %².
XLF is one of the assets that tracks PFG most closely: it ranks #3 out of the 32 assets we track against PFG. The last year tells two different stories: PFG led by 34.6 percentage points, +43.9% for PFG against +9.3% for XLF. Across three years, the rolling one-year figure varied moderately, from 0.58 to 0.90.
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.
PFG vs XLF: side by side
| PFG (Principal Financial Group) | XLF (Financial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +43.9% | +9.3% |
| 5-year return | +99.7% | +64.2% |
| Volatility (ann.) | 22.9% | 16.2% |
| Beta vs S&P 500 | 0.88 | 0.84 |
| Max drawdown (3Y) | -22.4% | -15.5% |
| Market cap | $24.0B | – |
| P/E (trailing) | 16.0 | – |
| Dividend yield | 2.84% | 1.42% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $57.9B |
| Sector / category | Financials | Sector ETF |
XLF is a Financial fund from State Street Investment Management: $57.9B under management, 77 holdings, a 0.08% expense ratio, a 1.42% trailing dividend yield.
Year-by-year returns
| Year | PFG | XLF |
|---|---|---|
| 2022 | +20.1% | -10.6% |
| 2023 | -2.8% | +12.0% |
| 2024 | +1.9% | +30.6% |
| 2025 | +18.4% | +14.9% |
| 2026 | +29.3% | +6.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
PFG represents 0.27% of XLF's portfolio, so part of any move in XLF is PFG itself, and the correlation between them is partly mechanical.
Are PFG and XLF good diversifiers for each other?
Only partially. A correlation of 0.73 means PFG and XLF share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
FAQ
What is the correlation between PFG and XLF?
As of 2026-08-27, the correlation of weekly returns between PFG and XLF is 0.73 over 3 years, 0.58 over 1 year and 0.79 over 5 years.
Is XLF a good diversifier for PFG?
Only partially. A correlation of 0.73 means PFG and XLF share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
What does a correlation of 0.73 mean?
Correlation ranges from −1 to +1. Values near +1 mean two assets move together, near 0 that they move independently, and negative values that they tend to move in opposite directions. It measures co-movement, not performance.
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Related comparisons
Hubs: PFG correlations · XLF correlations
