XLU vs XLY: Correlation & Overlap
Utilities Select Sector SPDR Fund (XLU) and Consumer Discretionary Select Sector SPDR Fund (XLY) show a weak relationship: their 3-year correlation of weekly returns is 0.11. The two funds also share 0% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are XLU and XLY?
Over the past 3 years, XLU and XLY moved with a correlation of 0.11, which is weak. Lately the two have drifted apart, with the 1-year correlation at -0.22 versus 0.11 over 3 years. Over 5 years the correlation is 0.28, and the annualized covariance of weekly returns is 35.1 %².
Within XLU's tracked universe of 100 assets, XLY comes in at #85 by 3-year correlation. Twelve-month performance is nearly a tie, at +4.1% for XLU and -0.1% for XLY. Do not treat this figure as fixed: across three years the rolling one-year correlation ranged all the way from -0.21 to 0.41.
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 XLY: side by side
| XLU (Utilities Select Sector SPDR Fund) | XLY (Consumer Discretionary Select Sector SPDR Fund) | |
|---|---|---|
| 1-year return | +4.1% | -0.1% |
| 5-year return | +46.3% | +31.8% |
| Volatility (ann.) | 15.8% | 19.7% |
| Beta vs S&P 500 | 0.26 | 1.15 |
| Max drawdown (3Y) | -13.1% | -26.0% |
| Dividend yield | 2.70% | 0.78% |
| Expense ratio | 0.08% | 0.08% |
| Assets under management | $23.1B | $22.5B |
| 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. 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.
Portfolio overlap between XLU and XLY
The two portfolios are largely distinct. Weighing the shared positions, 0% of the two funds is identical, spread across 0 common holdings. That shared book is a large part of why the returns line up.
Largest positions held only by XLU: NEE (12.94%), SO (7.45%), DUK (7.00%), CEG (6.58%), AEP (4.94%). Only by XLY: AMZN (24.32%), TSLA (16.18%), HD (5.54%), MCD (4.11%), BKNG (4.04%).
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 | XLY |
|---|---|---|
| 2022 | +1.4% | -36.3% |
| 2023 | -7.2% | +39.6% |
| 2024 | +23.3% | +26.5% |
| 2025 | +16.0% | +7.4% |
| 2026 | +2.5% | -2.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are XLU and XLY good diversifiers for each other?
Yes: at 0.11, the two have gone their own ways historically, which is what genuine diversification looks like.
FAQ
What is the correlation between XLU and XLY?
Using weekly returns as of 2026-08-27: 0.11 over 3 years, with -0.22 over the last year and 0.28 over 5 years.
Is XLY a good diversifier for XLU?
Yes: at 0.11, the two have gone their own ways historically, which is what genuine diversification looks like.
How much do XLU and XLY overlap?
0% by weight, across 0 common holdings, based on issuer-disclosed portfolios as of 2026-08-26.
Use this data
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Related comparisons
Hubs: XLU correlations · XLY correlations
