XLP vs ZSQR: Correlation
Consumer Staples Select Sector SPDR Fund (XLP) and Z Squared Inc. (ZSQR) show a negative relationship: their 3-year correlation of weekly returns is -0.22.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are XLP and ZSQR?
On 3 years of weekly data the XLP/ZSQR correlation comes out at -0.22, negative, meaning they tend to move in opposite directions. The relationship has been stable: the 1-year correlation (-0.29) sits close to the 3-year figure. The 5-year figure is -0.05, and annualized covariance runs at -243.8 %².
Out of 110 assets tracked against XLP, ZSQR lands near the bottom at #107. Correlation aside, the last 12 months split them widely, with XLP ahead by 76.5 points (+8.3% versus -68.2%). Note the risk asymmetry: ZSQR runs 8.9 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
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.
XLP vs ZSQR: side by side
| XLP (Consumer Staples Select Sector SPDR Fund) | ZSQR (Z Squared Inc.) | |
|---|---|---|
| 1-year return | +8.3% | -68.2% |
| 5-year return | +34.7% | -97.9% |
| Volatility (ann.) | 11.1% | 98.5% |
| Beta vs S&P 500 | 0.23 | 0.28 |
| Max drawdown (3Y) | -9.7% | -89.7% |
| Market cap | – | $0.2B |
| P/E (trailing) | – | – |
| Dividend yield | 2.58% | 0.00% |
| Expense ratio | 0.08% | – |
| Assets under management | $14.6B | – |
| Sector / category | Sector ETF | US Listed |
XLP is a Consumer Defensive fund from State Street Investment Management: $14.6B under management, 35 holdings, a 0.08% expense ratio, a 2.58% trailing dividend yield.
Year-by-year returns
| Year | XLP | ZSQR |
|---|---|---|
| 2022 | -0.8% | -84.7% |
| 2023 | -0.8% | -48.8% |
| 2024 | +12.2% | -64.9% |
| 2025 | +1.5% | +159.1% |
| 2026 | +10.9% | -70.3% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are XLP and ZSQR good diversifiers for each other?
Yes: at -0.22, the two have gone their own ways historically, which is what genuine diversification looks like.
FAQ
What is the correlation between XLP and ZSQR?
The XLP/ZSQR correlation stands at -0.22 on a 3-year window (1 year: -0.29, 5 years: -0.05), computed from weekly returns as of 2026-08-27.
Is ZSQR a good diversifier for XLP?
Yes: at -0.22, the two have gone their own ways historically, which is what genuine diversification looks like.
What does a correlation of -0.22 mean?
On the −1 to +1 scale, -0.22 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
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Related comparisons
Hubs: XLP correlations · ZSQR correlations
