VEA vs XLV: Correlation & Overlap
Vanguard FTSE Developed Markets ETF (VEA) and Health Care Select Sector SPDR Fund (XLV) show a moderate relationship: their 3-year correlation of weekly returns is 0.49. Looking through to holdings, 0.1% 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 XLV?
On 3 years of weekly data the VEA/XLV correlation comes out at 0.49, moderate. The link has loosened recently: the 1-year correlation (0.28) runs below the 3-year figure (0.49). The 5-year figure is 0.55, and annualized covariance runs at 108.0 %².
Among the 107 assets we track against VEA, XLV ranks #87 by 3-year correlation. Twelve-month performance is nearly a tie, at +28.5% for VEA and +27.5% for XLV. The rolling one-year correlation moved between 0.31 and 0.66 over the past three years, a moderate range.
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 XLV: side by side
| VEA (Vanguard FTSE Developed Markets ETF) | XLV (Health Care Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +28.5% | +27.5% |
| 5-year return | +63.5% | +37.4% |
| Volatility (ann.) | 15.1% | 14.7% |
| Beta vs S&P 500 | 0.79 | 0.42 |
| Max drawdown (3Y) | -13.5% | -17.1% |
| Dividend yield | 2.56% | 1.56% |
| Expense ratio | 0.03% | 0.08% |
| Assets under management | $314.9B | $41.7B |
| Sector / category | ETF · International | Sector ETF |
On the fund side, VEA sits in the Foreign Large Blend category at Vanguard, with $314.9B under management, 3769 holdings, a 0.03% expense ratio, a 2.56% trailing dividend yield. On the fund side, XLV sits in the Health category at State Street Investment Management, with $41.7B under management, 61 holdings, a 0.08% expense ratio, a 1.56% trailing dividend yield.
Portfolio overlap between VEA and XLV
The two portfolios are largely distinct. Weighing the shared positions, 0.1% of the two funds is identical, spread across 6 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in VEA | Weight in XLV |
|---|---|---|
| MRK | 0.07% | 6.04% |
| BDX | 0.01% | 0.84% |
| CRL | 0.00% | 0.23% |
| ELV | 0.00% | 1.40% |
| COR | 0.00% | 1.02% |
| HUM | 0.00% | 0.75% |
Largest positions held only by VEA: 005930 (2.53%), ASML (2.00%), 000660 (1.98%), HSBA (1.15%), ROP (0.97%). Only by XLV: LLY (15.03%), JNJ (10.38%), ABBV (7.42%), UNH (5.82%), AMGN (3.80%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-07-31. Top 6 common positions shown.
Year-by-year returns
| Year | VEA | XLV |
|---|---|---|
| 2022 | -15.3% | -2.1% |
| 2023 | +17.9% | +2.1% |
| 2024 | +3.1% | +2.5% |
| 2025 | +35.2% | +14.5% |
| 2026 | +18.3% | +11.8% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VEA and XLV good diversifiers for each other?
Reasonably. At 0.49, VEA and XLV keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between VEA and XLV?
Using weekly returns as of 2026-08-27: 0.49 over 3 years, with 0.28 over the last year and 0.55 over 5 years.
Is XLV a good diversifier for VEA?
Reasonably. At 0.49, VEA and XLV keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do VEA and XLV overlap?
The two funds share 6 holdings amounting to 0.1% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vea-vs-xlv.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/vea-vs-xlv/)
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Hubs: VEA correlations · XLV correlations
