STWD vs VNQ: Correlation
Measured on weekly returns over the past three years, STARWOOD PROPERTY TRUST, INC. Starwood Property Trust Inc. (STWD) and Vanguard Real Estate ETF (VNQ) carry a correlation of 0.74, a strong link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are STWD and VNQ?
Across a 3-year window, the weekly returns of STWD and VNQ correlate at 0.74, strong. The relationship has been stable: the 1-year correlation (0.65) sits close to the 3-year figure. Stretching to 5 years gives 0.72, with an annualized covariance of 236.8 %².
Few assets follow STWD as closely as VNQ, which ranks #2 of 26 tracked partners. Their recent paths diverged sharply: over the last 12 months VNQ outperformed by 22.1 percentage points (-11.8% for STWD against +10.3% for VNQ).
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.
STWD vs VNQ: side by side
| STWD (STARWOOD PROPERTY TRUST, INC. Starwood Property Trust Inc.) | VNQ (Vanguard Real Estate ETF) | |
|---|---|---|
| 1-year return | -11.8% | +10.3% |
| 5-year return | +0.5% | +9.5% |
| Volatility (ann.) | 19.3% | 16.6% |
| Beta vs S&P 500 | 0.65 | 0.59 |
| Max drawdown (3Y) | -15.8% | -17.5% |
| Market cap | $6.1B | – |
| P/E (trailing) | 27.0 | – |
| Dividend yield | 12.07% | 3.51% |
| Expense ratio | – | 0.13% |
| Assets under management | – | $73.1B |
| Sector / category | US Listed | ETF · Real Estate |
VNQ is a Real Estate fund from Vanguard: $73.1B under management, 140 holdings, a 0.13% expense ratio, a 3.51% trailing dividend yield.
Year-by-year returns
| Year | STWD | VNQ |
|---|---|---|
| 2022 | -17.3% | -26.3% |
| 2023 | +26.7% | +11.9% |
| 2024 | -0.6% | +4.8% |
| 2025 | +4.9% | +3.2% |
| 2026 | -6.3% | +12.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are STWD and VNQ good diversifiers for each other?
Somewhat, no more. With 0.74 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between STWD and VNQ?
As of 2026-08-27, the correlation of weekly returns between STWD and VNQ is 0.74 over 3 years, 0.65 over 1 year and 0.72 over 5 years.
Is VNQ a good diversifier for STWD?
Somewhat, no more. With 0.74 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.74 mean?
On the −1 to +1 scale, 0.74 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/stwd-vs-vnq.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/stwd-vs-vnq/)
Free with attribution; caching and terms are described in the API documentation.
Related comparisons
Hubs: STWD correlations · VNQ correlations
