SPY vs XBI: Correlation
Measured on weekly returns over the past three years, SPDR S&P 500 ETF Trust (SPY) and SPDR S&P Biotech ETF (XBI) carry a correlation of 0.57, a moderate link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SPY and XBI?
Across a 3-year window, the weekly returns of SPY and XBI correlate at 0.57, moderate. Lately the two have drifted apart, with the 1-year correlation at 0.42 versus 0.57 over 3 years. Stretching to 5 years gives 0.59, with an annualized covariance of 227.8 %².
By 3-year correlation, XBI places #240 of the 4755 assets tracked against SPY. Correlation aside, the last 12 months split them widely, with XBI ahead by 66.6 points (+20.6% versus +87.2%). The rolling one-year correlation moved between 0.40 and 0.74 over the past three years, a moderate range. One caveat on sizing: XBI 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.
SPY vs XBI: side by side
| SPY (SPDR S&P 500 ETF Trust) | XBI (SPDR S&P Biotech ETF) | |
|---|---|---|
| 1-year return | +20.6% | +87.2% |
| 5-year return | +82.4% | +28.6% |
| Volatility (ann.) | 14.5% | 27.7% |
| Beta vs S&P 500 | 1.00 | 1.09 |
| Max drawdown (3Y) | -18.8% | -33.0% |
| Dividend yield | 1.01% | – |
| Expense ratio | 0.09% | – |
| Assets under management | $795.3B | – |
| Sector / category | ETF · US Large Cap | ETF · Thematic |
On the fund side, SPY sits in the Large Blend category at State Street Investment Management, with $795.3B under management, 504 holdings, a 0.09% expense ratio, a 1.01% trailing dividend yield.
Year-by-year returns
| Year | SPY | XBI |
|---|---|---|
| 2022 | -18.2% | -25.9% |
| 2023 | +26.2% | +7.6% |
| 2024 | +24.9% | +1.0% |
| 2025 | +17.7% | +35.9% |
| 2026 | +13.7% | +38.1% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SPY and XBI good diversifiers for each other?
To a limited degree. At 0.57 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between SPY and XBI?
The SPY/XBI correlation stands at 0.57 on a 3-year window (1 year: 0.42, 5 years: 0.59), computed from weekly returns as of 2026-08-27.
Is XBI a good diversifier for SPY?
To a limited degree. At 0.57 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
What does a correlation of 0.57 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.
Use this data
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Related comparisons
Hubs: SPY correlations · XBI correlations
