SMH vs XLK: Correlation
Measured on weekly returns over the past three years, VanEck Semiconductor ETF (SMH) and Technology Select Sector SPDR Fund (XLK) carry a correlation of 0.92, a very strong link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SMH and XLK?
On 3 years of weekly data the SMH/XLK correlation comes out at 0.92, very strong, meaning they move nearly in lockstep. Little has changed lately, as the 1-year reading of 0.88 lands near the 3-year figure. The 5-year figure is 0.91, and annualized covariance runs at 744.9 %².
In SMH's tracked universe of 88 assets, XLK sits right near the top at #2. Correlation aside, the last 12 months split them widely, with SMH ahead by 49.7 points (+93.1% versus +43.4%). The rolling one-year correlation stayed in a tight band between 0.85 and 0.96 over the past three years, which points to a structural rather than episodic relationship.
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.
SMH vs XLK: side by side
| SMH (VanEck Semiconductor ETF) | XLK (Technology Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +93.1% | +43.4% |
| 5-year return | +332.8% | +145.2% |
| Volatility (ann.) | 33.7% | 24.0% |
| Beta vs S&P 500 | 1.91 | 1.50 |
| Max drawdown (3Y) | -35.7% | -25.7% |
| Dividend yield | – | 0.45% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $115.4B |
| Sector / category | ETF · Thematic | Sector ETF |
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.
Year-by-year returns
| Year | SMH | XLK |
|---|---|---|
| 2022 | -33.5% | -27.7% |
| 2023 | +73.4% | +56.0% |
| 2024 | +39.1% | +21.6% |
| 2025 | +49.2% | +24.6% |
| 2026 | +59.1% | +31.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SMH and XLK good diversifiers for each other?
Not really. At 0.92, the two trade almost as one position, and owning both buys little extra protection.
FAQ
What is the correlation between SMH and XLK?
The SMH/XLK correlation stands at 0.92 on a 3-year window (1 year: 0.88, 5 years: 0.91), computed from weekly returns as of 2026-08-27.
Is XLK a good diversifier for SMH?
Not really. At 0.92, the two trade almost as one position, and owning both buys little extra protection.
What does a correlation of 0.92 mean?
On the −1 to +1 scale, 0.92 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.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/smh-vs-xlk.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/smh-vs-xlk/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: SMH correlations · XLK correlations
