VOO vs XLRE: Correlation & Overlap
How closely do Vanguard S&P 500 ETF (VOO) and Real Estate Select Sector SPDR Fund (XLRE) trade together? Their weekly returns over three years give a correlation of 0.49, which is moderate. By holdings, the two funds overlap 1.8% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VOO and XLRE?
Over the past 3 years, VOO and XLRE moved with a correlation of 0.49, which is moderate. The past 12 months show a weaker link (0.25) than the 3-year average (0.49). Over 5 years the correlation is 0.67, and the annualized covariance of weekly returns is 118.7 %².
Among the 124 assets we track against VOO, XLRE ranks #99 by 3-year correlation. Over the last 12 months VOO came out ahead by 11.1 percentage points (+20.6% against +9.5%). The relationship is regime-dependent: the rolling one-year correlation swung between 0.24 and 0.87 over the past three years, so this pair behaves very differently depending on the market environment.
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.
VOO vs XLRE: side by side
| VOO (Vanguard S&P 500 ETF) | XLRE (Real Estate Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +20.6% | +9.5% |
| 5-year return | +83.0% | +11.4% |
| Volatility (ann.) | 14.4% | 16.7% |
| Beta vs S&P 500 | 0.99 | 0.57 |
| Max drawdown (3Y) | -18.7% | -16.6% |
| Dividend yield | 1.07% | 3.12% |
| Expense ratio | 0.03% | 0.08% |
| Assets under management | $1,686.9B | $8.6B |
| Sector / category | ETF · US Large Cap | Sector ETF |
On the fund side, VOO sits in the Large Blend category at Vanguard, with $1,686.9B under management, 503 holdings, a 0.03% expense ratio, a 1.07% 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 VOO and XLRE
The two portfolios are largely distinct: 1.8% of the funds' weight sits in the same underlying holdings (29 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in VOO | Weight in XLRE |
|---|---|---|
| WELL | 0.26% | 11.43% |
| PLD | 0.21% | 9.06% |
| EQIX | 0.16% | 7.14% |
| AMT | 0.13% | 5.49% |
| SPG | 0.12% | 4.72% |
| DLR | 0.10% | 5.01% |
| O | 0.09% | 4.46% |
| PSA | 0.08% | 4.63% |
| VTR | 0.07% | 4.59% |
| CBRE | 0.07% | 4.45% |
| IRM | 0.06% | 3.65% |
| CCI | 0.05% | 3.33% |
| EXR | 0.05% | 3.08% |
| VICI | 0.04% | 2.87% |
| SBAC | 0.03% | 1.99% |
Largest positions held only by VOO: NVDA (7.56%), AAPL (7.05%), MSFT (5.37%), AMZN (4.13%), GOOGL (3.25%). Only by XLRE: VMRK (4.96%), XARU6 (0.00%).
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 | VOO | XLRE |
|---|---|---|
| 2022 | -18.2% | -26.2% |
| 2023 | +26.3% | +12.4% |
| 2024 | +25.0% | +5.1% |
| 2025 | +17.8% | +2.6% |
| 2026 | +13.7% | +12.4% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VOO and XLRE good diversifiers for each other?
Yes, to a useful degree: a correlation of 0.49 leaves real independence between the two, which historically damped combined volatility.
FAQ
What is the correlation between VOO and XLRE?
As of 2026-08-27, the correlation of weekly returns between VOO and XLRE is 0.49 over 3 years, 0.25 over 1 year and 0.67 over 5 years.
Is XLRE a good diversifier for VOO?
Yes, to a useful degree: a correlation of 0.49 leaves real independence between the two, which historically damped combined volatility.
How much do VOO and XLRE overlap?
1.8% by weight, across 29 common holdings, based on issuer-disclosed portfolios as of 2026-07-31.
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Hubs: VOO correlations · XLRE correlations
