STT vs XLF: Correlation
State Street Corporation (STT) and Financial Select Sector SPDR Fund (XLF) show a strong relationship: their 3-year correlation of weekly returns is 0.76.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are STT and XLF?
On 3 years of weekly data the STT/XLF correlation comes out at 0.76, strong. Little has changed lately, as the 1-year reading of 0.68 lands near the 3-year figure. The 5-year figure is 0.80, and annualized covariance runs at 281.7 %².
Few assets follow STT as closely as XLF, which ranks #1 of 32 tracked partners. The last year tells two different stories: STT led by 63.4 percentage points, +72.7% for STT against +9.3% for XLF. Across three years, the rolling one-year figure varied moderately, from 0.61 to 0.89.
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.
STT vs XLF: side by side
| STT (State Street Corporation) | XLF (Financial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +72.7% | +9.3% |
| 5-year return | +144.9% | +64.2% |
| Volatility (ann.) | 22.9% | 16.2% |
| Beta vs S&P 500 | 0.97 | 0.84 |
| Max drawdown (3Y) | -25.7% | -15.5% |
| Market cap | $53.1B | – |
| P/E (trailing) | 17.1 | – |
| Dividend yield | 1.74% | 1.42% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $57.9B |
| Sector / category | Financials | Sector ETF |
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.
Year-by-year returns
| Year | STT | XLF |
|---|---|---|
| 2022 | -13.8% | -10.6% |
| 2023 | +3.5% | +12.0% |
| 2024 | +30.2% | +30.6% |
| 2025 | +35.5% | +14.9% |
| 2026 | +52.6% | +6.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
A structural note: 0.65% of XLF is STT itself, so the fund partly moves with the stock by construction.
Are STT and XLF good diversifiers for each other?
Only partially. A correlation of 0.76 means STT and XLF share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
FAQ
What is the correlation between STT and XLF?
The STT/XLF correlation stands at 0.76 on a 3-year window (1 year: 0.68, 5 years: 0.80), computed from weekly returns as of 2026-08-27.
Is XLF a good diversifier for STT?
Only partially. A correlation of 0.76 means STT and XLF share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
What does a correlation of 0.76 mean?
A reading of 0.76 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
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Related comparisons
Hubs: STT correlations · XLF correlations
