VT vs XLB: Correlation & Overlap
Measured on weekly returns over the past three years, Vanguard Total World Stock ETF (VT) and Materials Select Sector SPDR Fund (XLB) carry a correlation of 0.72, a strong link. The two funds also share 1.0% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VT and XLB?
Over the past 3 years, VT and XLB moved with a correlation of 0.72, which is strong. The link has loosened recently: the 1-year correlation (0.53) runs below the 3-year figure (0.72). Over 5 years the correlation is 0.81, and the annualized covariance of weekly returns is 167.9 %².
By 3-year correlation, XLB places #58 of the 136 assets tracked against VT. The trailing year gives VT the advantage: +22.7% versus +17.6%, a 5.1-point spread. On a rolling one-year basis the correlation drifted between 0.55 and 0.92, 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.
VT vs XLB: side by side
| VT (Vanguard Total World Stock ETF) | XLB (Materials Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +22.7% | +17.6% |
| 5-year return | +67.7% | +36.9% |
| Volatility (ann.) | 13.9% | 16.7% |
| Beta vs S&P 500 | 0.92 | 0.72 |
| Max drawdown (3Y) | -16.5% | -23.2% |
| Dividend yield | 1.59% | 1.68% |
| Expense ratio | 0.06% | 0.08% |
| Assets under management | $97.9B | $8.3B |
| Sector / category | ETF · Global | Sector ETF |
VT is a Global Large-Stock Blend fund from Vanguard: $97.9B under management, 5308 holdings, a 0.06% expense ratio, a 1.59% trailing dividend yield. XLB is a Natural Resources fund from State Street Investment Management: $8.3B under management, 26 holdings, a 0.08% expense ratio, a 1.68% trailing dividend yield.
Portfolio overlap between VT and XLB
The two portfolios are largely distinct: 1.0% of the funds' weight sits in the same underlying holdings (25 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in VT | Weight in XLB |
|---|---|---|
| LIN | 0.20% | 12.94% |
| NEM | 0.09% | 8.02% |
| FCX | 0.08% | 6.48% |
| SHW | 0.07% | 4.87% |
| ECL | 0.06% | 4.80% |
| APD | 0.06% | 4.71% |
| CRH | 0.06% | 4.12% |
| NUE | 0.05% | 4.28% |
| CTVA | 0.05% | 4.72% |
| VMC | 0.03% | 4.26% |
| STLD | 0.03% | 3.73% |
| MLM | 0.03% | 4.09% |
| SW | 0.02% | 3.39% |
| PPG | 0.02% | 3.32% |
| DOW | 0.02% | 2.85% |
Largest positions held only by VT: NVDA (4.20%), AAPL (4.00%), MSFT (3.09%), AMZN (2.36%), GOOGL (1.89%). Only by XLB: IXDU6 (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 | VT | XLB |
|---|---|---|
| 2022 | -18.0% | -12.3% |
| 2023 | +22.0% | +12.5% |
| 2024 | +16.5% | +0.1% |
| 2025 | +22.4% | +9.9% |
| 2026 | +15.2% | +18.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VT and XLB good diversifiers for each other?
Only partially. A correlation of 0.72 means VT and XLB 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 VT and XLB?
The VT/XLB correlation stands at 0.72 on a 3-year window (1 year: 0.53, 5 years: 0.81), computed from weekly returns as of 2026-08-27.
Is XLB a good diversifier for VT?
Only partially. A correlation of 0.72 means VT and XLB share most of their swings. Pairing them dampens volatility somewhat, but it will not protect against a common drawdown.
How much do VT and XLB overlap?
The two funds share 25 holdings amounting to 1.0% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vt-vs-xlb.json
Embed this badge (it refreshes with the data), with attribution:
[](https://www.pairbook.io/pair/vt-vs-xlb/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: VT correlations · XLB correlations
