VIG vs XLK: Correlation & Overlap
Measured on weekly returns over the past three years, Vanguard Dividend Appreciation ETF (VIG) and Technology Select Sector SPDR Fund (XLK) carry a correlation of 0.71, a strong link. Looking through to holdings, 25.1% 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 VIG and XLK?
Over the past 3 years, VIG and XLK moved with a correlation of 0.71, which is strong. The past 12 months show a weaker link (0.53) than the 3-year average (0.71). Over 5 years the correlation is 0.78, and the annualized covariance of weekly returns is 201.8 %².
Among the 106 assets we track against VIG, XLK ranks #32 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months XLK outperformed by 26.3 percentage points (+17.1% for VIG against +43.4% for XLK). On a rolling one-year basis the correlation drifted between 0.49 and 0.86, a moderate band. One caveat on sizing: XLK is 2.0 times as volatile as the other leg, so an equal-dollar split is far from equal-risk.
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.
VIG vs XLK: side by side
| VIG (Vanguard Dividend Appreciation ETF) | XLK (Technology Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +17.1% | +43.4% |
| 5-year return | +64.0% | +145.2% |
| Volatility (ann.) | 11.9% | 24.0% |
| Beta vs S&P 500 | 0.74 | 1.50 |
| Max drawdown (3Y) | -15.0% | -25.7% |
| Dividend yield | 1.50% | 0.45% |
| Expense ratio | 0.04% | 0.08% |
| Assets under management | $130.9B | $115.4B |
| Sector / category | ETF · Dividend | Sector ETF |
VIG, Vanguard's Large Blend fund, carries $130.9B under management, 333 holdings, a 0.04% expense ratio, a 1.50% trailing dividend yield. On the fund side, XLK sits in the Technology category at State Street Investment Management, with $115.4B under management, 73 holdings, a 0.08% expense ratio, a 0.45% trailing dividend yield.
Portfolio overlap between VIG and XLK
The two portfolios partially overlap. Weighing the shared positions, 25.1% of the two funds is identical, spread across 19 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in VIG | Weight in XLK |
|---|---|---|
| AVGO | 4.65% | 4.61% |
| AAPL | 4.47% | 12.61% |
| MSFT | 4.35% | 10.10% |
| CSCO | 1.99% | 2.97% |
| LRCX | 1.59% | 2.62% |
| TXN | 1.09% | 1.59% |
| KLAC | 1.04% | 1.61% |
| ORCL | 0.96% | 1.69% |
| IBM | 0.91% | 1.45% |
| APH | 0.86% | 1.33% |
| ADI | 0.78% | 1.21% |
| QCOM | 0.68% | 1.15% |
| ACN | 0.44% | 0.75% |
| INTU | 0.38% | 0.64% |
| MSI | 0.31% | 0.54% |
Largest positions held only by VIG: JPM (4.09%), LLY (3.94%), XOM (2.80%), JNJ (2.68%), V (2.46%). Only by XLK: NVDA (13.91%), AMD (4.09%), MU (3.99%), INTC (2.92%), PLTR (2.73%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-07-31. Top 15 common positions shown.
Year-by-year returns
| Year | VIG | XLK |
|---|---|---|
| 2022 | -9.8% | -27.7% |
| 2023 | +14.5% | +56.0% |
| 2024 | +17.0% | +21.6% |
| 2025 | +14.2% | +24.6% |
| 2026 | +11.6% | +31.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VIG and XLK good diversifiers for each other?
Only partially. A correlation of 0.71 means VIG and XLK 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 VIG and XLK?
Using weekly returns as of 2026-08-27: 0.71 over 3 years, with 0.53 over the last year and 0.78 over 5 years.
Is XLK a good diversifier for VIG?
Only partially. A correlation of 0.71 means VIG and XLK share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
How much do VIG and XLK overlap?
The two funds share 19 holdings amounting to 25.1% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vig-vs-xlk.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/vig-vs-xlk/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: VIG correlations · XLK correlations
