VUG vs XLK: Correlation & Overlap
Vanguard Growth ETF (VUG) and Technology Select Sector SPDR Fund (XLK) show a very strong relationship: their 3-year correlation of weekly returns is 0.94. By holdings, the two funds overlap 54.9% by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VUG and XLK?
Across a 3-year window, the weekly returns of VUG and XLK correlate at 0.94, very strong, meaning they move nearly in lockstep. The relationship has been stable: the 1-year correlation (0.89) sits close to the 3-year figure. Stretching to 5 years gives 0.95, with an annualized covariance of 437.1 %².
Within VUG's tracked universe of 103 assets, XLK comes in at #9 by 3-year correlation. Correlation aside, the last 12 months split them widely, with XLK ahead by 27.2 points (+16.2% versus +43.4%). The link looks structural: the rolling one-year correlation barely moved, holding between 0.89 and 0.98.
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.
VUG vs XLK: side by side
| VUG (Vanguard Growth ETF) | XLK (Technology Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +16.2% | +43.4% |
| 5-year return | +78.4% | +145.2% |
| Volatility (ann.) | 19.4% | 24.0% |
| Beta vs S&P 500 | 1.28 | 1.50 |
| Max drawdown (3Y) | -22.8% | -25.7% |
| Dividend yield | 0.40% | 0.45% |
| Expense ratio | 0.03% | 0.08% |
| Assets under management | $372.0B | $115.4B |
| Sector / category | ETF · US Style | Sector ETF |
VUG is a Large Growth fund from Vanguard: $372.0B under management, 146 holdings, a 0.03% expense ratio, a 0.40% 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 VUG and XLK
The two portfolios overlap heavily: 54.9% of the funds' weight sits in the same underlying holdings (41 common positions). Correlation tells you they move together; overlap tells you why.
| Common holding | Weight in VUG | Weight in XLK |
|---|---|---|
| NVDA | 12.84% | 13.91% |
| AAPL | 12.63% | 12.61% |
| MSFT | 9.61% | 10.10% |
| AVGO | 4.47% | 4.61% |
| AMD | 2.17% | 4.09% |
| AMAT | 1.14% | 2.55% |
| LRCX | 1.03% | 2.62% |
| PANW | 0.77% | 1.84% |
| PLTR | 0.76% | 2.73% |
| KLAC | 0.68% | 1.61% |
| ORCL | 0.64% | 1.69% |
| APH | 0.57% | 1.33% |
| ANET | 0.56% | 1.40% |
| STX | 0.55% | 1.27% |
| WDC | 0.54% | 1.08% |
Largest positions held only by VUG: GOOGL (5.81%), AMZN (5.16%), GOOG (4.64%), META (3.41%), LLY (2.72%). Only by XLK: MU (3.99%), CSCO (2.97%), IBM (1.45%), ADI (1.21%), QCOM (1.15%).
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 | VUG | XLK |
|---|---|---|
| 2022 | -33.2% | -27.7% |
| 2023 | +46.8% | +56.0% |
| 2024 | +32.7% | +21.6% |
| 2025 | +19.4% | +24.6% |
| 2026 | +9.6% | +31.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VUG and XLK good diversifiers for each other?
No. With a correlation of 0.94, VUG and XLK move nearly in lockstep, so holding both adds very little diversification. The 54.9% holdings overlap makes the redundancy concrete: much of it is the same book twice.
FAQ
What is the correlation between VUG and XLK?
Using weekly returns as of 2026-08-27: 0.94 over 3 years, with 0.89 over the last year and 0.95 over 5 years.
Is XLK a good diversifier for VUG?
No. With a correlation of 0.94, VUG and XLK move nearly in lockstep, so holding both adds very little diversification. The 54.9% holdings overlap makes the redundancy concrete: much of it is the same book twice.
How much do VUG and XLK overlap?
54.9% by weight, across 41 common holdings, based on issuer-disclosed portfolios as of 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vug-vs-xlk.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/vug-vs-xlk/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: VUG correlations · XLK correlations
