Looking to diversify beyond XLU? The ETFs below have the lowest correlation with XLU — they tend to move on their own, which can help reduce risk when the rest of your portfolio drops. The stock ideas table highlights individual companies that behave independently from XLU.
Best Diversifiers for XLU
1438 ETFs have low correlation with XLU (below 0.3), 76 of which are negatively correlated. The least correlated is Direxion Daily MU Bull 2X Shares (MUU) (Leveraged Equities) with a 1Y correlation of -0.37, roughly unchanged from -0.37 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| Direxion Daily MU Bull 2X Shares | -0.37 | -0.37 | -0.37 | 99 | Leveraged Equities, Semiconductors | XLU vs MUU | |
| ProShares UltraShort Yen | -0.17 | -0.16 | -0.14 | 72 | Leveraged Currency | XLU vs YCS | |
| Proshares Ultrashort Bitcoin ETF | -0.14 | -0.14 | -0.14 | 52 | Cryptocurrency, Leveraged Cryptocurrency | XLU vs SBIT | |
| ProShares Short Bitcoin ETF | -0.13 | -0.13 | -0.13 | 57 | Cryptocurrency | XLU vs BITI | |
| Fidelity Managed Futures ETF | -0.13 | — | — | 71 | Systematic Trend | XLU vs FFUT |
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Low-Correlation Stock Ideas
If you're looking for individual stocks that move independently from XLU, these are worth exploring. The table shows U.S. companies ($1B+ market cap) with low correlation to XLU and solid risk/return profiles. The least correlated is Palo Alto Networks, Inc. (PANW) (Technology) with a 1Y correlation of -0.16, down from 0.08 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Palo Alto Networks, Inc. | -0.16 | -0.00 | 0.08 | 84 | Technology | |
| CrowdStrike Holdings, Inc. | -0.13 | -0.01 | 0.06 | 77 | Technology | |
| Fortinet, Inc. | -0.08 | 0.06 | 0.15 | 79 | Technology | |
| Credo Technology Group Holding Ltd | -0.06 | 0.01 | 0.06 | 83 | Technology | |
| AppLovin Corporation | -0.05 | 0.05 | 0.10 | 60 | Communication Services |
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