TRGP vs XLE: Correlation
Measured on weekly returns over the past three years, Targa Resources (TRGP) and Energy Select Sector SPDR Fund (XLE) carry a correlation of 0.77, a strong link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are TRGP and XLE?
Over the past 3 years, TRGP and XLE moved with a correlation of 0.77, which is strong. The relationship has been stable: the 1-year correlation (0.76) sits close to the 3-year figure. Over 5 years the correlation is 0.80, and the annualized covariance of weekly returns is 560.1 %².
In TRGP's tracked universe of 38 assets, XLE sits right near the top at #3. The last year tells two different stories: TRGP led by 34.7 percentage points, +78.7% for TRGP against +44.0% for XLE. Across three years, the rolling one-year figure varied moderately, from 0.60 to 0.90.
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.
TRGP vs XLE: side by side
| TRGP (Targa Resources) | XLE (Energy Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +78.7% | +44.0% |
| 5-year return | +626.8% | +206.7% |
| Volatility (ann.) | 31.5% | 23.1% |
| Beta vs S&P 500 | 0.44 | 0.27 |
| Max drawdown (3Y) | -31.6% | -20.1% |
| Market cap | $62.0B | – |
| P/E (trailing) | 28.1 | – |
| Dividend yield | 1.53% | 2.55% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $39.2B |
| Sector / category | Energy | Sector ETF |
XLE is an Equity Energy fund from State Street Investment Management: $39.2B under management, 22 holdings, a 0.08% expense ratio, a 2.55% trailing dividend yield.
Year-by-year returns
| Year | TRGP | XLE |
|---|---|---|
| 2022 | +43.7% | +64.3% |
| 2023 | +21.0% | -0.6% |
| 2024 | +110.1% | +5.6% |
| 2025 | +5.7% | +7.9% |
| 2026 | +58.9% | +41.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
TRGP represents 3.74% of XLE's portfolio, so part of any move in XLE is TRGP itself, and the correlation between them is partly mechanical.
Are TRGP and XLE good diversifiers for each other?
Somewhat, no more. With 0.77 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between TRGP and XLE?
As of 2026-08-27, the correlation of weekly returns between TRGP and XLE is 0.77 over 3 years, 0.76 over 1 year and 0.80 over 5 years.
Is XLE a good diversifier for TRGP?
Somewhat, no more. With 0.77 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.77 mean?
On the −1 to +1 scale, 0.77 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.
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Related comparisons
Hubs: TRGP correlations · XLE correlations
