USMV vs XLB: Correlation & Overlap
iShares MSCI USA Min Vol Factor ETF (USMV) and Materials Select Sector SPDR Fund (XLB) show a strong relationship: their 3-year correlation of weekly returns is 0.70. The two funds also share 2.6% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are USMV and XLB?
Over the past 3 years, USMV and XLB moved with a correlation of 0.70, which is strong. Lately the two have drifted apart, with the 1-year correlation at 0.46 versus 0.70 over 3 years. Over 5 years the correlation is 0.73, and the annualized covariance of weekly returns is 115.7 %².
By 3-year correlation, XLB places #23 of the 125 assets tracked against USMV. Over the last 12 months XLB came out ahead by 7.5 percentage points (+10.1% against +17.6%). Across three years, the rolling one-year figure varied moderately, from 0.48 to 0.86. Risk is not evenly split, since XLB 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.
USMV vs XLB: side by side
| USMV (iShares MSCI USA Min Vol Factor ETF) | XLB (Materials Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +10.1% | +17.6% |
| 5-year return | +42.3% | +36.9% |
| Volatility (ann.) | 9.9% | 16.7% |
| Beta vs S&P 500 | 0.51 | 0.72 |
| Max drawdown (3Y) | -9.4% | -23.2% |
| Dividend yield | 1.48% | 1.68% |
| Expense ratio | 0.15% | 0.08% |
| Assets under management | $23.6B | $8.3B |
| Sector / category | ETF · US Style | Sector ETF |
USMV is a Large Blend fund from iShares: $23.6B under management, 164 holdings, a 0.15% expense ratio, a 1.48% trailing dividend yield. XLB is a Natural Resources fund from State Street Investment Management: $8.3B under management, 26 holdings, a 0.08% expense ratio, a 1.68% trailing dividend yield.
Portfolio overlap between USMV and XLB
The two portfolios are largely distinct. Weighing the shared positions, 2.6% of the two funds is identical, spread across 3 common holdings. That shared book is a large part of why the returns line up.
Largest positions held only by USMV: MSFT (1.68%), VRTX (1.63%), JNJ (1.58%), WELL (1.57%), APH (1.54%). Only by XLB: FCX (6.48%), SHW (4.87%), ECL (4.80%), APD (4.71%), NUE (4.28%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 3 common positions shown.
Year-by-year returns
| Year | USMV | XLB |
|---|---|---|
| 2022 | -9.4% | -12.3% |
| 2023 | +10.3% | +12.5% |
| 2024 | +15.7% | +0.1% |
| 2025 | +7.6% | +9.9% |
| 2026 | +9.1% | +18.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are USMV and XLB good diversifiers for each other?
To a limited degree. At 0.70 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 USMV and XLB?
The USMV/XLB correlation stands at 0.70 on a 3-year window (1 year: 0.46, 5 years: 0.73), computed from weekly returns as of 2026-08-27.
Is XLB a good diversifier for USMV?
To a limited degree. At 0.70 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 USMV and XLB overlap?
2.6% by weight, across 3 common holdings, based on issuer-disclosed portfolios as of 2026-08-26.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/usmv-vs-xlb.json
Embed this badge (it refreshes with the data), with attribution:
[](https://www.pairbook.io/pair/usmv-vs-xlb/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: USMV correlations · XLB correlations
