SPY vs XLF: Correlation & Overlap
SPDR S&P 500 ETF Trust (SPY) and Financial Select Sector SPDR Fund (XLF) show a strong relationship: their 3-year correlation of weekly returns is 0.75. The two funds also share 12.4% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SPY and XLF?
Over the past 3 years, SPY and XLF moved with a correlation of 0.75, which is strong. Lately the two have drifted apart, with the 1-year correlation at 0.59 versus 0.75 over 3 years. Over 5 years the correlation is 0.80, and the annualized covariance of weekly returns is 175.3 %².
By 3-year correlation, XLF places #71 of the 4755 assets tracked against SPY. Over the last 12 months SPY came out ahead by 11.3 percentage points (+20.6% against +9.3%). Across three years, the rolling one-year figure varied moderately, from 0.54 to 0.86.
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 XLF: side by side
| SPY (SPDR S&P 500 ETF Trust) | XLF (Financial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +20.6% | +9.3% |
| 5-year return | +82.4% | +64.2% |
| Volatility (ann.) | 14.5% | 16.2% |
| Beta vs S&P 500 | 1.00 | 0.84 |
| Max drawdown (3Y) | -18.8% | -15.5% |
| Dividend yield | 1.01% | 1.42% |
| Expense ratio | 0.09% | 0.08% |
| Assets under management | $795.3B | $57.9B |
| Sector / category | ETF · US Large Cap | Sector ETF |
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. 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.
Portfolio overlap between SPY and XLF
The two portfolios are largely distinct: 12.4% of the funds' weight sits in the same underlying holdings (76 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in SPY | Weight in XLF |
|---|---|---|
| JPM | 1.44% | 11.61% |
| BRK.B | 1.40% | 11.25% |
| V | 0.96% | 7.74% |
| MA | 0.73% | 5.87% |
| BAC | 0.61% | 4.94% |
| GS | 0.46% | 3.73% |
| WFC | 0.39% | 3.17% |
| MS | 0.39% | 3.12% |
| C | 0.34% | 2.77% |
| AXP | 0.27% | 2.17% |
| SCHW | 0.27% | 2.17% |
| BLK | 0.26% | 2.06% |
| COF | 0.20% | 1.64% |
| SPGI | 0.20% | 1.61% |
| PGR | 0.20% | 1.58% |
Largest positions held only by SPY: NVDA (7.68%), AAPL (6.96%), MSFT (5.58%), AMZN (3.85%), GOOGL (3.03%). Only by XLF: IXAU6 (0.01%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 15 common positions shown.
Year-by-year returns
| Year | SPY | XLF |
|---|---|---|
| 2022 | -18.2% | -10.6% |
| 2023 | +26.2% | +12.0% |
| 2024 | +24.9% | +30.6% |
| 2025 | +17.7% | +14.9% |
| 2026 | +13.7% | +6.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SPY and XLF good diversifiers for each other?
To a limited degree. At 0.75 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 XLF?
The SPY/XLF correlation stands at 0.75 on a 3-year window (1 year: 0.59, 5 years: 0.80), computed from weekly returns as of 2026-08-27.
Is XLF a good diversifier for SPY?
To a limited degree. At 0.75 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
How much do SPY and XLF overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 12.4% by weight over 76 common positions.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/spy-vs-xlf.json
Embed this badge (it refreshes with the data), with attribution:
[](https://www.pairbook.io/pair/spy-vs-xlf/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: SPY correlations · XLF correlations
