VXZ vs XLY: Correlation
Measured on weekly returns over the past three years, iPath Series B S&P 500 VIX Mid-Term Futures ETN (VXZ) and Consumer Discretionary Select Sector SPDR Fund (XLY) carry a correlation of -0.65, a negative link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VXZ and XLY?
Across a 3-year window, the weekly returns of VXZ and XLY correlate at -0.65, negative, meaning they tend to move in opposite directions. Little has changed lately, as the 1-year reading of -0.63 lands near the 3-year figure. Stretching to 5 years gives -0.63, with an annualized covariance of -326.5 %².
Within VXZ's tracked universe of 2840 assets, XLY comes in at #2799 by 3-year correlation. Correlation aside, the last 12 months split them widely, with XLY ahead by 16.0 points (-16.1% versus -0.1%).
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 XLY: side by side
| VXZ (iPath Series B S&P 500 VIX Mid-Term Futures ETN) | XLY (Consumer Discretionary Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | -16.1% | -0.1% |
| 5-year return | -53.1% | +31.8% |
| Volatility (ann.) | 25.6% | 19.7% |
| Beta vs S&P 500 | -1.31 | 1.15 |
| Max drawdown (3Y) | -36.4% | -26.0% |
| Dividend yield | – | 0.78% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $22.5B |
| Sector / category | US Listed | Sector ETF |
XLY is a Consumer Cyclical fund from State Street Investment Management: $22.5B under management, 47 holdings, a 0.08% expense ratio, a 0.78% trailing dividend yield.
Year-by-year returns
| Year | VXZ | XLY |
|---|---|---|
| 2022 | +0.5% | -36.3% |
| 2023 | -44.0% | +39.6% |
| 2024 | -12.7% | +26.5% |
| 2025 | +5.7% | +7.4% |
| 2026 | -10.5% | -2.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VXZ and XLY good diversifiers for each other?
Yes: at -0.65, the two have gone their own ways historically, which is what genuine diversification looks like.
FAQ
What is the correlation between VXZ and XLY?
The VXZ/XLY correlation stands at -0.65 on a 3-year window (1 year: -0.63, 5 years: -0.63), computed from weekly returns as of 2026-08-27.
Is XLY a good diversifier for VXZ?
Yes: at -0.65, the two have gone their own ways historically, which is what genuine diversification looks like.
What does a correlation of -0.65 mean?
On the −1 to +1 scale, -0.65 describes how much the two returns move together: +1 is lockstep, 0 is independence, negative values mean opposite directions. It says nothing about which performed better.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vxz-vs-xly.json
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Related comparisons
Hubs: VXZ correlations · XLY correlations
