VTI vs XLE: Correlation & Overlap
Vanguard Total Stock Market ETF (VTI) and Energy Select Sector SPDR Fund (XLE) show a weak relationship: their 3-year correlation of weekly returns is 0.19. The two funds also share 3.0% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VTI and XLE?
Over the past 3 years, VTI and XLE moved with a correlation of 0.19, which is weak. Lately the two have drifted apart, with the 1-year correlation at -0.41 versus 0.19 over 3 years. Over 5 years the correlation is 0.29, and the annualized covariance of weekly returns is 64.3 %².
By 3-year correlation, XLE places #147 of the 157 assets tracked against VTI. Correlation aside, the last 12 months split them widely, with XLE ahead by 23.3 points (+20.7% versus +44.0%). The relationship is regime-dependent: the rolling one-year correlation swung between -0.43 and 0.57 over the past three years, so this pair behaves very differently depending on the market environment. One caveat on sizing: XLE is 1.6 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.
VTI vs XLE: side by side
| VTI (Vanguard Total Stock Market ETF) | XLE (Energy Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +20.7% | +44.0% |
| 5-year return | +74.8% | +206.7% |
| Volatility (ann.) | 14.6% | 23.1% |
| Beta vs S&P 500 | 1.01 | 0.27 |
| Max drawdown (3Y) | -19.3% | -20.1% |
| Dividend yield | 1.06% | 2.55% |
| Expense ratio | 0.03% | 0.08% |
| Assets under management | $2,290.0B | $39.2B |
| Sector / category | ETF · US Large Cap | Sector ETF |
VTI is a Large Blend fund from Vanguard: $2,290.0B under management, 3140 holdings, a 0.03% expense ratio, a 1.06% trailing dividend yield. XLE is an Equity Energy fund from State Street Investment Management: $39.2B under management, 22 holdings, a 0.08% expense ratio, a 2.55% trailing dividend yield.
Portfolio overlap between VTI and XLE
The two portfolios are largely distinct. Weighing the shared positions, 3.0% of the two funds is identical, spread across 21 common holdings. That shared book is a large part of why the returns line up.
| Common holding | Weight in VTI | Weight in XLE |
|---|---|---|
| XOM | 0.90% | 20.03% |
| CVX | 0.52% | 14.84% |
| COP | 0.20% | 6.30% |
| VLO | 0.13% | 5.05% |
| MPC | 0.13% | 5.40% |
| WMB | 0.12% | 3.84% |
| PSX | 0.12% | 5.37% |
| EOG | 0.11% | 4.24% |
| SLB | 0.10% | 4.46% |
| KMI | 0.08% | 3.72% |
| BKR | 0.08% | 3.65% |
| TRGP | 0.08% | 3.74% |
| OKE | 0.08% | 3.55% |
| DVN | 0.07% | 3.20% |
| OXY | 0.06% | 2.52% |
Largest positions held only by VTI: NVDA (6.42%), AAPL (6.31%), MSFT (4.80%), AMZN (3.66%), GOOGL (2.91%). Only by XLE: IXPU6 (0.01%).
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 | VTI | XLE |
|---|---|---|
| 2022 | -19.5% | +64.3% |
| 2023 | +26.0% | -0.6% |
| 2024 | +23.8% | +5.6% |
| 2025 | +17.1% | +7.9% |
| 2026 | +14.2% | +41.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VTI and XLE good diversifiers for each other?
Yes: at 0.19, the two have gone their own ways historically, which is what genuine diversification looks like.
FAQ
What is the correlation between VTI and XLE?
The VTI/XLE correlation stands at 0.19 on a 3-year window (1 year: -0.41, 5 years: 0.29), computed from weekly returns as of 2026-08-27.
Is XLE a good diversifier for VTI?
Yes: at 0.19, the two have gone their own ways historically, which is what genuine diversification looks like.
How much do VTI and XLE overlap?
The two funds share 21 holdings amounting to 3.0% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
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Hubs: VTI correlations · XLE correlations
