XLU vs XLV: Correlation & Overlap
How closely do Utilities Select Sector SPDR Fund (XLU) and Health Care Select Sector SPDR Fund (XLV) trade together? Their weekly returns over three years give a correlation of 0.29, which is weak. Looking through to holdings, 0% of the two portfolios is the same by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are XLU and XLV?
Across a 3-year window, the weekly returns of XLU and XLV correlate at 0.29, weak. The relationship has been stable: the 1-year correlation (0.27) sits close to the 3-year figure. Stretching to 5 years gives 0.48, with an annualized covariance of 68.1 %².
By 3-year correlation, XLV places #70 of the 100 assets tracked against XLU. Their recent paths diverged sharply: over the last 12 months XLV outperformed by 23.4 percentage points (+4.1% for XLU against +27.5% for XLV). This link changes with the market regime, having swung between 0.17 and 0.67 on a rolling one-year basis.
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.
XLU vs XLV: side by side
| XLU (Utilities Select Sector SPDR Fund) | XLV (Health Care Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +4.1% | +27.5% |
| 5-year return | +46.3% | +37.4% |
| Volatility (ann.) | 15.8% | 14.7% |
| Beta vs S&P 500 | 0.26 | 0.42 |
| Max drawdown (3Y) | -13.1% | -17.1% |
| Dividend yield | 2.70% | 1.56% |
| Expense ratio | 0.08% | 0.08% |
| Assets under management | $23.1B | $41.7B |
| Sector / category | Sector ETF | Sector ETF |
On the fund side, XLU sits in the Utilities category at State Street Investment Management, with $23.1B under management, 31 holdings, a 0.08% expense ratio, a 2.70% trailing dividend yield. On the fund side, XLV sits in the Health category at State Street Investment Management, with $41.7B under management, 61 holdings, a 0.08% expense ratio, a 1.56% trailing dividend yield.
Portfolio overlap between XLU and XLV
The two portfolios are largely distinct: 0% of the funds' weight sits in the same underlying holdings (0 common positions). Correlation tells you they move together; overlap tells you why.
Largest positions held only by XLU: NEE (12.94%), SO (7.45%), DUK (7.00%), CEG (6.58%), AEP (4.94%). Only by XLV: LLY (15.03%), JNJ (10.38%), ABBV (7.42%), MRK (6.04%), UNH (5.82%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-08-26.
Year-by-year returns
| Year | XLU | XLV |
|---|---|---|
| 2022 | +1.4% | -2.1% |
| 2023 | -7.2% | +2.1% |
| 2024 | +23.3% | +2.5% |
| 2025 | +16.0% | +14.5% |
| 2026 | +2.5% | +11.8% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are XLU and XLV good diversifiers for each other?
Reasonably. At 0.29, XLU and XLV keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between XLU and XLV?
The XLU/XLV correlation stands at 0.29 on a 3-year window (1 year: 0.27, 5 years: 0.48), computed from weekly returns as of 2026-08-27.
Is XLV a good diversifier for XLU?
Reasonably. At 0.29, XLU and XLV keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
How much do XLU and XLV overlap?
Per the issuers' own portfolio disclosures (2026-08-26), the overlap is 0% by weight over 0 common positions.
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