WFC vs XLF: Correlation
Wells Fargo (WFC) and Financial Select Sector SPDR Fund (XLF) show a strong relationship: their 3-year correlation of weekly returns is 0.78.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are WFC and XLF?
On 3 years of weekly data the WFC/XLF correlation comes out at 0.78, strong. Recent behaviour matches the longer record: 0.68 over 1 year against 0.78 over 3. The 5-year figure is 0.81, and annualized covariance runs at 373.0 %².
Few assets follow WFC as closely as XLF, which ranks #3 of 29 tracked partners. Neither side won the trailing year by much: +5.2% against +9.3%. Stability stands out here, with the rolling one-year correlation confined to 0.66 through 0.89. One caveat on sizing: WFC is 1.8 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.
WFC vs XLF: side by side
| WFC (Wells Fargo) | XLF (Financial Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +5.2% | +9.3% |
| 5-year return | +98.3% | +64.2% |
| Volatility (ann.) | 29.7% | 16.2% |
| Beta vs S&P 500 | 0.98 | 0.84 |
| Max drawdown (3Y) | -24.7% | -15.5% |
| Market cap | $256.9B | – |
| P/E (trailing) | 12.4 | – |
| Dividend yield | 2.11% | 1.42% |
| Expense ratio | – | 0.08% |
| Assets under management | – | $57.9B |
| Sector / category | Financials | Sector ETF |
XLF is a Financial fund from State Street Investment Management: $57.9B under management, 77 holdings, a 0.08% expense ratio, a 1.42% trailing dividend yield.
Year-by-year returns
| Year | WFC | XLF |
|---|---|---|
| 2022 | -11.9% | -10.6% |
| 2023 | +22.9% | +12.0% |
| 2024 | +46.5% | +30.6% |
| 2025 | +35.6% | +14.9% |
| 2026 | -7.3% | +6.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
Keep in mind that XLF holds WFC at a 3.17% weight, which makes a slice of this correlation mechanical rather than coincidental.
Are WFC and XLF good diversifiers for each other?
Somewhat, no more. With 0.78 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between WFC and XLF?
The WFC/XLF correlation stands at 0.78 on a 3-year window (1 year: 0.68, 5 years: 0.81), computed from weekly returns as of 2026-08-27.
Is XLF a good diversifier for WFC?
Somewhat, no more. With 0.78 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.78 mean?
On the −1 to +1 scale, 0.78 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.
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Related comparisons
Hubs: WFC correlations · XLF correlations
