SPY vs XLK: Correlation & Overlap
How closely do SPDR S&P 500 ETF Trust (SPY) and Technology Select Sector SPDR Fund (XLK) trade together? Their weekly returns over three years give a correlation of 0.90, which is very strong. Looking through to holdings, 37.0% of the two portfolios is the same by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SPY and XLK?
Across a 3-year window, the weekly returns of SPY and XLK correlate at 0.90, very strong, meaning they move nearly in lockstep. Little has changed lately, as the 1-year reading of 0.87 lands near the 3-year figure. Stretching to 5 years gives 0.91, with an annualized covariance of 313.0 %².
Within SPY's tracked universe of 4755 assets, XLK comes in at #16 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months XLK outperformed by 22.8 percentage points (+20.6% for SPY against +43.4% for XLK). The link looks structural: the rolling one-year correlation barely moved, holding between 0.82 and 0.95. Risk is not evenly split, since XLK carries 1.7 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.
SPY vs XLK: side by side
| SPY (SPDR S&P 500 ETF Trust) | XLK (Technology Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +20.6% | +43.4% |
| 5-year return | +82.4% | +145.2% |
| Volatility (ann.) | 14.5% | 24.0% |
| Beta vs S&P 500 | 1.00 | 1.50 |
| Max drawdown (3Y) | -18.8% | -25.7% |
| Dividend yield | 1.01% | 0.45% |
| Expense ratio | 0.09% | 0.08% |
| Assets under management | $795.3B | $115.4B |
| 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. 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 SPY and XLK
The two portfolios partially overlap: 37.0% of the funds' weight sits in the same underlying holdings (73 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in SPY | Weight in XLK |
|---|---|---|
| NVDA | 7.68% | 13.91% |
| AAPL | 6.96% | 12.61% |
| MSFT | 5.58% | 10.10% |
| AVGO | 2.55% | 4.61% |
| MU | 1.60% | 3.99% |
| AMD | 1.19% | 4.09% |
| CSCO | 0.67% | 2.97% |
| INTC | 0.66% | 2.92% |
| PLTR | 0.62% | 2.73% |
| LRCX | 0.59% | 2.62% |
| AMAT | 0.58% | 2.55% |
| PANW | 0.42% | 1.84% |
| ORCL | 0.38% | 1.69% |
| KLAC | 0.36% | 1.61% |
| TXN | 0.36% | 1.59% |
Largest positions held only by SPY: AMZN (3.85%), GOOGL (3.03%), GOOG (2.42%), META (1.91%), TSLA (1.47%). Only by XLK: .
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 | XLK |
|---|---|---|
| 2022 | -18.2% | -27.7% |
| 2023 | +26.2% | +56.0% |
| 2024 | +24.9% | +21.6% |
| 2025 | +17.7% | +24.6% |
| 2026 | +13.7% | +31.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SPY and XLK good diversifiers for each other?
No: a correlation of 0.90 means SPY and XLK tend to fall together, which is precisely when diversification is supposed to help.
FAQ
What is the correlation between SPY and XLK?
As of 2026-08-27, the correlation of weekly returns between SPY and XLK is 0.90 over 3 years, 0.87 over 1 year and 0.91 over 5 years.
Is XLK a good diversifier for SPY?
No: a correlation of 0.90 means SPY and XLK tend to fall together, which is precisely when diversification is supposed to help.
How much do SPY and XLK overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 37.0% by weight over 73 common positions.
Use this data
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Related comparisons
Hubs: SPY correlations · XLK correlations
