VYM vs XLI: Correlation & Overlap
Measured on weekly returns over the past three years, Vanguard High Dividend Yield ETF (VYM) and Industrial Select Sector SPDR Fund (XLI) carry a correlation of 0.88, a very strong link. The two funds also share 11.9% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VYM and XLI?
On 3 years of weekly data the VYM/XLI correlation comes out at 0.88, very strong, meaning they move nearly in lockstep. The relationship has been stable: the 1-year correlation (0.78) sits close to the 3-year figure. The 5-year figure is 0.89, and annualized covariance runs at 169.8 %².
By 3-year correlation, XLI places #10 of the 122 assets tracked against VYM. Neither side won the trailing year by much: +21.1% against +18.3%. The rolling one-year correlation stayed in a tight band between 0.78 and 0.95 over the past three years, which points to a structural rather than episodic relationship.
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.
VYM vs XLI: side by side
| VYM (Vanguard High Dividend Yield ETF) | XLI (Industrial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +21.1% | +18.3% |
| 5-year return | +76.6% | +84.0% |
| Volatility (ann.) | 12.3% | 15.7% |
| Beta vs S&P 500 | 0.69 | 0.89 |
| Max drawdown (3Y) | -14.5% | -18.5% |
| Dividend yield | 2.24% | 1.15% |
| Expense ratio | 0.04% | 0.08% |
| Assets under management | $99.2B | $32.9B |
| Sector / category | ETF · Dividend | Sector ETF |
VYM, Vanguard's Large Value fund, carries $99.2B under management, 604 holdings, a 0.04% expense ratio, a 2.24% trailing dividend yield. XLI is an Industrials fund from State Street Investment Management: $32.9B under management, 83 holdings, a 0.08% expense ratio, a 1.15% trailing dividend yield.
Portfolio overlap between VYM and XLI
The two portfolios are largely distinct, with 42 holdings in common adding up to 11.9% of fund weight. Where correlation shows the co-movement, the overlap shows its source.
| Common holding | Weight in VYM | Weight in XLI |
|---|---|---|
| CAT | 1.51% | 6.68% |
| RTX | 1.18% | 5.04% |
| UNP | 0.71% | 3.25% |
| ETN | 0.66% | 2.87% |
| LMT | 0.48% | 2.02% |
| ADP | 0.43% | 1.98% |
| GD | 0.40% | 1.71% |
| MMM | 0.37% | 1.66% |
| JCI | 0.37% | 1.55% |
| CMI | 0.36% | 1.41% |
| WM | 0.34% | 1.44% |
| EMR | 0.34% | 1.56% |
| ITW | 0.34% | 1.32% |
| UPS | 0.32% | 1.39% |
| HON | 0.31% | 1.23% |
Largest positions held only by VYM: AVGO (7.37%), JPM (3.83%), XOM (2.63%), JNJ (2.51%), CSCO (1.87%). Only by XLI: GE (6.52%), GEV (4.52%), BA (2.95%), UBER (2.82%), DE (2.81%).
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 | VYM | XLI |
|---|---|---|
| 2022 | -0.4% | -5.6% |
| 2023 | +6.6% | +18.1% |
| 2024 | +17.6% | +17.3% |
| 2025 | +15.4% | +19.3% |
| 2026 | +15.9% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VYM and XLI good diversifiers for each other?
Not really. At 0.88, the two trade almost as one position, and owning both buys little extra protection.
FAQ
What is the correlation between VYM and XLI?
The VYM/XLI correlation stands at 0.88 on a 3-year window (1 year: 0.78, 5 years: 0.89), computed from weekly returns as of 2026-08-27.
Is XLI a good diversifier for VYM?
Not really. At 0.88, the two trade almost as one position, and owning both buys little extra protection.
How much do VYM and XLI overlap?
The two funds share 42 holdings amounting to 11.9% of weight, per issuer portfolio files dated 2026-07-31.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/vym-vs-xli.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/vym-vs-xli/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: VYM correlations · XLI correlations
