SCHD vs XLK: Correlation & Overlap
Schwab US Dividend Equity ETF (SCHD) and Technology Select Sector SPDR Fund (XLK) show a moderate relationship: their 3-year correlation of weekly returns is 0.34. By holdings, the two funds overlap 3.6% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SCHD and XLK?
Over the past 3 years, SCHD and XLK moved with a correlation of 0.34, which is moderate. The past 12 months show a weaker link (-0.06) than the 3-year average (0.34). Over 5 years the correlation is 0.53, and the annualized covariance of weekly returns is 105.0 %².
By 3-year correlation, XLK places #97 of the 108 assets tracked against SCHD. Over the last 12 months XLK came out ahead by 13.8 percentage points (+29.6% against +43.4%). This link changes with the market regime, having swung between -0.04 and 0.68 on a rolling one-year basis. Risk is not evenly split, since XLK carries 1.9 times the volatility of the other side.
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 XLK: side by side
| SCHD (Schwab US Dividend Equity ETF) | XLK (Technology Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +29.6% | +43.4% |
| 5-year return | +60.9% | +145.2% |
| Volatility (ann.) | 12.9% | 24.0% |
| Beta vs S&P 500 | 0.52 | 1.50 |
| Max drawdown (3Y) | -16.1% | -25.7% |
| Dividend yield | 3.13% | 0.45% |
| Expense ratio | 0.06% | 0.08% |
| Assets under management | $104.2B | $115.4B |
| Sector / category | ETF · Dividend | Sector ETF |
On the fund side, SCHD sits in the Large Value category at Schwab ETFs, with $104.2B under management, 101 holdings, a 0.06% expense ratio, a 3.13% trailing dividend yield. On the fund side, XLK sits in the Technology category at State Street Investment Management, with $115.4B under management, 73 holdings, a 0.08% expense ratio, a 0.45% trailing dividend yield.
Portfolio overlap between SCHD and XLK
The two portfolios are largely distinct. Weighing the shared positions, 3.6% of the two funds is identical, spread across 4 common holdings. That shared book is a large part of why the returns line up.
Largest positions held only by SCHD: MRK (4.92%), ABT (4.83%), AMGN (4.80%), KO (4.22%), VZ (3.97%). Only by XLK: NVDA (13.91%), AAPL (12.61%), MSFT (10.10%), AVGO (4.61%), AMD (4.09%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 4 common positions shown.
Year-by-year returns
| Year | SCHD | XLK |
|---|---|---|
| 2022 | -3.3% | -27.7% |
| 2023 | +4.5% | +56.0% |
| 2024 | +11.7% | +21.6% |
| 2025 | +4.3% | +24.6% |
| 2026 | +29.1% | +31.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SCHD and XLK good diversifiers for each other?
Reasonably. At 0.34, SCHD and XLK keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between SCHD and XLK?
Using weekly returns as of 2026-08-27: 0.34 over 3 years, with -0.06 over the last year and 0.53 over 5 years.
Is XLK a good diversifier for SCHD?
Reasonably. At 0.34, SCHD and XLK keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do SCHD and XLK overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 3.6% by weight over 4 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/schd-vs-xlk.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/schd-vs-xlk/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: SCHD correlations · XLK correlations
