VXZ vs XLC: Correlation
How closely do iPath Series B S&P 500 VIX Mid-Term Futures ETN (VXZ) and Communication Services Select Sector SPDR Fund (XLC) trade together? Their weekly returns over three years give a correlation of -0.55, which is negative.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VXZ and XLC?
Across a 3-year window, the weekly returns of VXZ and XLC correlate at -0.55, negative, meaning they tend to move in opposite directions. The relationship has been stable: the 1-year correlation (-0.48) sits close to the 3-year figure. Stretching to 5 years gives -0.55, with an annualized covariance of -224.0 %².
Among the 2840 assets we track against VXZ, XLC ranks #2680 by 3-year correlation. Their recent paths diverged sharply: over the last 12 months XLC outperformed by 17.6 percentage points (-16.1% for VXZ against +1.5% for XLC). Risk is not evenly split, since VXZ carries 1.6 times the volatility of the other side.
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.
VXZ vs XLC: side by side
| VXZ (iPath Series B S&P 500 VIX Mid-Term Futures ETN) | XLC (Communication Services Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | -16.1% | +1.5% |
| 5-year return | -53.1% | +37.5% |
| Volatility (ann.) | 25.6% | 16.0% |
| Beta vs S&P 500 | -1.31 | 0.90 |
| Max drawdown (3Y) | -36.4% | -18.0% |
| Dividend yield | – | 1.32% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $21.7B |
| Sector / category | US Listed | Sector ETF |
On the fund side, XLC sits in the Communications category at State Street Investment Management, with $21.7B under management, 24 holdings, a 0.08% expense ratio, a 1.32% trailing dividend yield.
Year-by-year returns
| Year | VXZ | XLC |
|---|---|---|
| 2022 | +0.5% | -37.6% |
| 2023 | -44.0% | +52.8% |
| 2024 | -12.7% | +34.7% |
| 2025 | +5.7% | +23.1% |
| 2026 | -10.5% | -4.8% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VXZ and XLC good diversifiers for each other?
Yes. With a correlation of -0.55, VXZ and XLC have moved largely independently, which makes them a genuinely diversifying pair by historical standards.
FAQ
What is the correlation between VXZ and XLC?
Using weekly returns as of 2026-08-27: -0.55 over 3 years, with -0.48 over the last year and -0.55 over 5 years.
Is XLC a good diversifier for VXZ?
Yes. With a correlation of -0.55, VXZ and XLC have moved largely independently, which makes them a genuinely diversifying pair by historical standards.
What does a correlation of -0.55 mean?
A reading of -0.55 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
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Related comparisons
Hubs: VXZ correlations · XLC correlations
