USMV vs XLI: Correlation & Overlap
Measured on weekly returns over the past three years, iShares MSCI USA Min Vol Factor ETF (USMV) and Industrial Select Sector SPDR Fund (XLI) carry a correlation of 0.74, a strong link. Looking through to holdings, 5.0% 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 USMV and XLI?
Over the past 3 years, USMV and XLI moved with a correlation of 0.74, which is strong. Lately the two have drifted apart, with the 1-year correlation at 0.39 versus 0.74 over 3 years. Over 5 years the correlation is 0.79, and the annualized covariance of weekly returns is 115.6 %².
By 3-year correlation, XLI places #21 of the 125 assets tracked against USMV. On 12-month performance XLI holds a 8.2-point edge, +10.1% against +18.3%. The rolling one-year correlation moved between 0.42 and 0.90 over the past three years, a moderate range. Risk is not evenly split, since XLI carries 1.6 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 XLI: side by side
| USMV (iShares MSCI USA Min Vol Factor ETF) | XLI (Industrial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +10.1% | +18.3% |
| 5-year return | +42.3% | +84.0% |
| Volatility (ann.) | 9.9% | 15.7% |
| Beta vs S&P 500 | 0.51 | 0.89 |
| Max drawdown (3Y) | -9.4% | -18.5% |
| Dividend yield | 1.48% | 1.15% |
| Expense ratio | 0.15% | 0.08% |
| Assets under management | $23.6B | $32.9B |
| Sector / category | ETF · US Style | Sector ETF |
On the fund side, USMV sits in the Large Blend category at iShares, with $23.6B under management, 164 holdings, a 0.15% expense ratio, a 1.48% trailing dividend yield. XLI is an Industrials fund from State Street Investment Management: $32.9B under management, 83 holdings, a 0.08% expense ratio, a 1.15% trailing dividend yield.
Portfolio overlap between USMV and XLI
The two portfolios are largely distinct. Weighing the shared positions, 5.0% of the two funds is identical, spread across 10 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in USMV | Weight in XLI |
|---|---|---|
| WM | 1.31% | 1.44% |
| LMT | 0.81% | 2.02% |
| RSG | 1.26% | 0.78% |
| NOC | 0.75% | 1.30% |
| GEV | 0.59% | 4.52% |
| UBER | 0.29% | 2.82% |
| ROL | 0.25% | 0.19% |
| RTX | 0.14% | 5.04% |
| ADP | 0.08% | 1.98% |
| GD | 0.07% | 1.71% |
Largest positions held only by USMV: MSFT (1.68%), NEM (1.65%), VRTX (1.63%), JNJ (1.58%), WELL (1.57%). Only by XLI: CAT (6.68%), GE (6.52%), UNP (3.25%), BA (2.95%), ETN (2.87%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 10 common positions shown.
Year-by-year returns
| Year | USMV | XLI |
|---|---|---|
| 2022 | -9.4% | -5.6% |
| 2023 | +10.3% | +18.1% |
| 2024 | +15.7% | +17.3% |
| 2025 | +7.6% | +19.3% |
| 2026 | +9.1% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are USMV and XLI 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 USMV and XLI?
As of 2026-08-27, the correlation of weekly returns between USMV and XLI is 0.74 over 3 years, 0.39 over 1 year and 0.79 over 5 years.
Is XLI a good diversifier for USMV?
Somewhat, no more. With 0.74 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do USMV and XLI overlap?
The two funds share 10 holdings amounting to 5.0% of weight, per issuer portfolio files dated 2026-08-26.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/usmv-vs-xli.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/usmv-vs-xli/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: USMV correlations · XLI correlations
