SCHD vs XLI: Correlation & Overlap
Schwab US Dividend Equity ETF (SCHD) and Industrial Select Sector SPDR Fund (XLI) show a strong relationship: their 3-year correlation of weekly returns is 0.71. The two funds also share 7.9% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SCHD and XLI?
On 3 years of weekly data the SCHD/XLI correlation comes out at 0.71, strong. The link has loosened recently: the 1-year correlation (0.41) runs below the 3-year figure (0.71). The 5-year figure is 0.81, and annualized covariance runs at 143.7 %².
Among the 108 assets we track against SCHD, XLI ranks #18 by 3-year correlation. Over the last 12 months SCHD came out ahead by 11.3 percentage points (+29.6% against +18.3%). The rolling one-year correlation moved between 0.46 and 0.93 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.
SCHD vs XLI: side by side
| SCHD (Schwab US Dividend Equity ETF) | XLI (Industrial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +29.6% | +18.3% |
| 5-year return | +60.9% | +84.0% |
| Volatility (ann.) | 12.9% | 15.7% |
| Beta vs S&P 500 | 0.52 | 0.89 |
| Max drawdown (3Y) | -16.1% | -18.5% |
| Dividend yield | 3.13% | 1.15% |
| Expense ratio | 0.06% | 0.08% |
| Assets under management | $104.2B | $32.9B |
| Sector / category | ETF · Dividend | Sector ETF |
SCHD is a Large Value fund from Schwab ETFs: $104.2B under management, 101 holdings, a 0.06% expense ratio, a 3.13% trailing dividend yield. XLI is an Industrials fund from State Street Investment Management: $32.9B under management, 83 holdings, a 0.08% expense ratio, a 1.15% trailing dividend yield.
Portfolio overlap between SCHD and XLI
The two portfolios are largely distinct: 7.9% of the funds' weight sits in the same underlying holdings (7 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in SCHD | Weight in XLI |
|---|---|---|
| LMT | 2.79% | 2.02% |
| ADP | 2.73% | 1.98% |
| UPS | 1.92% | 1.39% |
| FAST | 1.43% | 1.04% |
| PAYX | 0.98% | 0.71% |
| BR | 0.51% | 0.37% |
| SNA | 0.50% | 0.36% |
Largest positions held only by SCHD: MRK (4.92%), ABT (4.83%), AMGN (4.80%), KO (4.22%), VZ (3.97%). Only by XLI: CAT (6.68%), GE (6.52%), RTX (5.04%), GEV (4.52%), UNP (3.25%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 7 common positions shown.
Year-by-year returns
| Year | SCHD | XLI |
|---|---|---|
| 2022 | -3.3% | -5.6% |
| 2023 | +4.5% | +18.1% |
| 2024 | +11.7% | +17.3% |
| 2025 | +4.3% | +19.3% |
| 2026 | +29.1% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SCHD and XLI good diversifiers for each other?
Somewhat, no more. With 0.71 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between SCHD and XLI?
As of 2026-08-27, the correlation of weekly returns between SCHD and XLI is 0.71 over 3 years, 0.41 over 1 year and 0.81 over 5 years.
Is XLI a good diversifier for SCHD?
Somewhat, no more. With 0.71 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do SCHD and XLI overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 7.9% by weight over 7 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/schd-vs-xli.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/schd-vs-xli/)
No key needed, free to use. Full endpoint list in the API documentation.
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Hubs: SCHD correlations · XLI correlations
