VEA vs XLRE: Correlation & Overlap
Vanguard FTSE Developed Markets ETF (VEA) and Real Estate Select Sector SPDR Fund (XLRE) show a moderate relationship: their 3-year correlation of weekly returns is 0.54. Looking through to holdings, 0.0% 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 VEA and XLRE?
Across a 3-year window, the weekly returns of VEA and XLRE correlate at 0.54, moderate. The link has loosened recently: the 1-year correlation (0.43) runs below the 3-year figure (0.54). Stretching to 5 years gives 0.64, with an annualized covariance of 137.1 %².
Among the 107 assets we track against VEA, XLRE ranks #78 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months VEA outperformed by 19.0 percentage points (+28.5% for VEA against +9.5% for XLRE). On a rolling one-year basis the correlation drifted between 0.42 and 0.83, 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.
VEA vs XLRE: side by side
| VEA (Vanguard FTSE Developed Markets ETF) | XLRE (Real Estate Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +28.5% | +9.5% |
| 5-year return | +63.5% | +11.4% |
| Volatility (ann.) | 15.1% | 16.7% |
| Beta vs S&P 500 | 0.79 | 0.57 |
| Max drawdown (3Y) | -13.5% | -16.6% |
| Dividend yield | 2.56% | 3.12% |
| Expense ratio | 0.03% | 0.08% |
| Assets under management | $314.9B | $8.6B |
| Sector / category | ETF · International | Sector ETF |
VEA, Vanguard's Foreign Large Blend fund, carries $314.9B under management, 3769 holdings, a 0.03% expense ratio, a 2.56% trailing dividend yield. On the fund side, XLRE sits in the Real Estate category at State Street Investment Management, with $8.6B under management, 31 holdings, a 0.08% expense ratio, a 3.12% trailing dividend yield.
Portfolio overlap between VEA and XLRE
The two portfolios are largely distinct: 0.0% of the funds' weight sits in the same underlying holdings (4 common positions). Correlation tells you they move together; overlap tells you why.
Largest positions held only by VEA: 005930 (2.53%), ASML (2.00%), 000660 (1.98%), HSBA (1.15%), ROP (0.97%). Only by XLRE: WELL (11.43%), PLD (9.06%), EQIX (7.14%), AMT (5.49%), DLR (5.01%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-07-31. Top 4 common positions shown.
Year-by-year returns
| Year | VEA | XLRE |
|---|---|---|
| 2022 | -15.3% | -26.2% |
| 2023 | +17.9% | +12.4% |
| 2024 | +3.1% | +5.1% |
| 2025 | +35.2% | +2.6% |
| 2026 | +18.3% | +12.4% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VEA and XLRE good diversifiers for each other?
Only partially. A correlation of 0.54 means VEA and XLRE share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
FAQ
What is the correlation between VEA and XLRE?
Using weekly returns as of 2026-08-27: 0.54 over 3 years, with 0.43 over the last year and 0.64 over 5 years.
Is XLRE a good diversifier for VEA?
Only partially. A correlation of 0.54 means VEA and XLRE share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
How much do VEA and XLRE overlap?
The two funds share 4 holdings amounting to 0.0% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vea-vs-xlre.json
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Related comparisons
Hubs: VEA correlations · XLRE correlations
