USMV vs XLP: Correlation & Overlap
How closely do iShares MSCI USA Min Vol Factor ETF (USMV) and Consumer Staples Select Sector SPDR Fund (XLP) trade together? Their weekly returns over three years give a correlation of 0.60, which is strong. Looking through to holdings, 9.2% 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 XLP?
On 3 years of weekly data the USMV/XLP correlation comes out at 0.60, strong. Lately the two have drifted apart, with the 1-year correlation at 0.43 versus 0.60 over 3 years. The 5-year figure is 0.74, and annualized covariance runs at 65.9 %².
Among the 125 assets we track against USMV, XLP ranks #43 by 3-year correlation. Their 12-month results are close: +10.1% for USMV against +8.3% for XLP. On a rolling one-year basis the correlation drifted between 0.44 and 0.88, a moderate band.
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 XLP: side by side
| USMV (iShares MSCI USA Min Vol Factor ETF) | XLP (Consumer Staples Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +10.1% | +8.3% |
| 5-year return | +42.3% | +34.7% |
| Volatility (ann.) | 9.9% | 11.1% |
| Beta vs S&P 500 | 0.51 | 0.23 |
| Max drawdown (3Y) | -9.4% | -9.7% |
| Dividend yield | 1.48% | 2.58% |
| Expense ratio | 0.15% | 0.08% |
| Assets under management | $23.6B | $14.6B |
| 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. On the fund side, XLP sits in the Consumer Defensive category at State Street Investment Management, with $14.6B under management, 35 holdings, a 0.08% expense ratio, a 2.58% trailing dividend yield.
Portfolio overlap between USMV and XLP
The two portfolios are largely distinct. Weighing the shared positions, 9.2% of the two funds is identical, spread across 14 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in USMV | Weight in XLP |
|---|---|---|
| KO | 1.28% | 7.34% |
| PG | 1.02% | 7.10% |
| CL | 0.90% | 4.56% |
| PEP | 0.85% | 4.39% |
| MNST | 0.84% | 4.28% |
| MDLZ | 0.71% | 4.37% |
| WMT | 0.65% | 9.62% |
| CHD | 0.59% | 1.53% |
| KR | 0.57% | 2.08% |
| PM | 0.57% | 6.36% |
| KDP | 0.56% | 2.75% |
| COST | 0.28% | 8.92% |
| HSY | 0.22% | 1.72% |
| TSN | 0.16% | 1.00% |
Largest positions held only by USMV: MSFT (1.68%), NEM (1.65%), VRTX (1.63%), JNJ (1.58%), WELL (1.57%). Only by XLP: TGT (4.67%), MO (4.21%), SYY (2.50%), ADM (2.42%), KVUE (2.32%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26. Top 14 common positions shown.
Year-by-year returns
| Year | USMV | XLP |
|---|---|---|
| 2022 | -9.4% | -0.8% |
| 2023 | +10.3% | -0.8% |
| 2024 | +15.7% | +12.2% |
| 2025 | +7.6% | +1.5% |
| 2026 | +9.1% | +10.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are USMV and XLP good diversifiers for each other?
To a limited degree. At 0.60 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 XLP?
The USMV/XLP correlation stands at 0.60 on a 3-year window (1 year: 0.43, 5 years: 0.74), computed from weekly returns as of 2026-08-27.
Is XLP a good diversifier for USMV?
To a limited degree. At 0.60 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 XLP overlap?
9.2% by weight, across 14 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-xlp.json
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Hubs: USMV correlations · XLP correlations
