Looking to balance out your exposure to TECH? The ETFs below have the lowest correlation with TECH — they tend to move on their own, which can help reduce risk when TECH drops. The stock ideas table highlights individual companies that behave independently from TECH.
Best Diversifiers for TECH
3 ETFs have low correlation with TECH (below 0.3), 0 of which are negatively correlated. The least correlated is State Street Technology Select Sector SPDR ETF (XLK) (Technology Equities) with a 1Y correlation of 0.23, down from 0.43 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| State Street Technology Select Sector SPDR ETF | 0.23 | 0.29 | 0.43 | 83 | Technology Equities | TECH vs XLK | |
| Global X Artificial Intelligence & Technology ETF | 0.28 | 0.33 | 0.46 | 81 | Technology Equities | TECH vs AIQ | |
| Invesco QQQ ETF | 0.28 | 0.32 | 0.46 | 73 | Nasdaq-100 | TECH vs QQQ | |
| State Street SPDR S&P 500 ETF | 0.37 | 0.41 | 0.51 | 70 | S&P 500 | TECH vs SPY |
Low-Correlation Stock Ideas
If you're looking for individual stocks that move independently from TECH, these are worth exploring. The table shows U.S. companies ($1B+ market cap) with low correlation to TECH and solid risk/return profiles. The least correlated is Exelixis, Inc. (EXEL) (Healthcare) with a 1Y correlation of 0.22, roughly unchanged from 0.28 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Exelixis, Inc. | 0.22 | 0.25 | 0.28 | 56 | Healthcare | |
| Catalyst Pharmaceuticals, Inc. | 0.27 | 0.27 | 0.29 | 60 | Healthcare | |
| Ligand Pharmaceuticals Incorporated | 0.30 | 0.33 | 0.35 | 95 | Healthcare | |
| Halozyme Therapeutics, Inc. | 0.30 | 0.35 | 0.37 | 66 | Healthcare | |
| Moderna, Inc. | 0.33 | 0.40 | 0.39 | 74 | Healthcare |
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