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EEM vs. XLE
Performance
Return for Risk
Drawdowns
Volatility
Dividends

EEM vs. XLE

Last updated Jun 14, 2026

EEM (iShares MSCI Emerging Markets ETF) and XLE (State Street Energy Select Sector SPDR ETF) are both exchange-traded funds - EEM is a Emerging Markets Diversified fund tracking the MSCI Emerging Markets Index (Net), while XLE is a Energy Equities fund tracking the Energy Select Sector Index. Both are passively managed. Over the past 10 years, EEM returned 9.91%/yr vs 9.91%/yr for XLE. A 0.54 correlation means they provide meaningful diversification when combined. EEM charges 0.72%/yr vs 0.08%/yr for XLE.

Performance

EEM vs. XLE - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares MSCI Emerging Markets ETF (EEM) and State Street Energy Select Sector SPDR ETF (XLE). The values are adjusted to include any dividend payments, if applicable.

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Returns By Period

In the year-to-date period, EEM achieves a 24.07% return, which is significantly lower than XLE's 29.56% return. Over a longer period, both investments have demonstrated similar performance, with their 10-year annualized returns being quite close: EEM at 9.91% and XLE at 9.91%.

EEM

1D
0.56%
1M
0.74%
YTD
24.07%
6M
26.94%
1Y
47.57%
3Y*
21.60%
5Y*
6.56%
10Y*
9.91%

XLE

1D
0.75%
1M
-0.90%
YTD
29.56%
6M
28.37%
1Y
34.84%
3Y*
16.18%
5Y*
20.12%
10Y*
9.91%
*Multi-year figures are annualized to reflect compound growth (CAGR)

EEM vs. XLE - Yearly Performance Comparison

2026 (YTD)202520242023202220212020201920182017
EEM
iShares MSCI Emerging Markets ETF		24.07%33.98%6.49%8.95%-20.56%-3.63%17.02%18.22%-15.31%37.26%
XLE
State Street Energy Select Sector SPDR ETF		29.56%7.88%5.56%-0.63%64.32%53.28%-32.67%11.74%-18.22%-0.89%

Correlation

The correlation between EEM and XLE is -0.05, meaning there is essentially no relationship between their price movements. Each responds to its own set of market drivers, making them strong candidates for combining in a diversified portfolio.

Correlation
Correlation (1Y)
Calculated over the trailing 1-year period

-0.05

Correlation (3Y)
Calculated over the trailing 3-year period

0.16

Correlation (5Y)
Calculated over the trailing 5-year period

0.26

Correlation (10Y)
Calculated over the trailing 10-year period

0.39

Correlation (All Time)
Calculated using the full available price history since Apr 14, 2003

0.54

The correlation between EEM and XLE shifts across timeframes, from -0.05 (1 year) to 0.54 (all time), reflecting how their relationship changes across market environments.

EEM vs. XLE - Sectors Allocation Comparison

Sectors
EEM
XLE

Technology

44.3%

-

Financial Services

17.7%

-

Consumer Cyclical

8.3%

-

Industrials

6.6%

-

Communication Services

6.0%

-

Basic Materials

5.9%

-

Energy

3.4%
100.0%

Consumer Defensive

2.5%

-

Healthcare

2.5%

-

Utilities

1.8%

-

Real Estate

1.0%

-

Technology

EEM
44.3%
XLE

-

Financial Services

EEM
17.7%
XLE

-

Consumer Cyclical

EEM
8.3%
XLE

-

Industrials

EEM
6.6%
XLE

-

Communication Services

EEM
6.0%
XLE

-

Basic Materials

EEM
5.9%
XLE

-

Energy

EEM
3.4%
XLE
100.0%

Consumer Defensive

EEM
2.5%
XLE

-

Healthcare

EEM
2.5%
XLE

-

Utilities

EEM
1.8%
XLE

-

Real Estate

EEM
1.0%
XLE

-

Compare stocks, funds, or ETFs

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iShares MSCI Emerging Markets ETF

State Street Energy Select Sector SPDR ETF

Often compared with EEM:
EEM vs. VWOEEM vs. SPYEEM vs. IEMGEEM vs. IS3N.DEEEM vs. VXUSEEM vs. EEMSEEM vs. SPEM
Often compared with XLE:
XLE vs. VDEXLE vs. USOXLE vs. XOPXLE vs. XLUXLE vs. XLKXLE vs. IXCXLE vs. FENY

Return for Risk

EEM vs. XLE — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.
EEM
EEM Risk / Return Rank: 7575
Overall Rank
EEM Sharpe Ratio Rank: 7676
Sharpe Ratio Rank
EEM Sortino Ratio Rank: 7070
Sortino Ratio Rank
EEM Omega Ratio Rank: 7878
Omega Ratio Rank
EEM Calmar Ratio Rank: 7575
Calmar Ratio Rank
EEM Martin Ratio Rank: 7575
Martin Ratio Rank
XLE
XLE Risk / Return Rank: 6161
Overall Rank
XLE Sharpe Ratio Rank: 6464
Sharpe Ratio Rank
XLE Sortino Ratio Rank: 5858
Sortino Ratio Rank
XLE Omega Ratio Rank: 5454
Omega Ratio Rank
XLE Calmar Ratio Rank: 7171
Calmar Ratio Rank
XLE Martin Ratio Rank: 5656
Martin Ratio Rank
The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

EEM vs. XLE - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares MSCI Emerging Markets ETF (EEM) and State Street Energy Select Sector SPDR ETF (XLE). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

EEMXLEDifference
Sharpe ratioReturn per unit of total volatility
2.10
1.82

+0.28

Sortino ratioReturn per unit of downside risk
2.73
2.40

+0.33

Omega ratioGain probability vs. loss probability

1.40

1.30

+0.10

Calmar ratioReturn relative to maximum drawdown

3.36

3.10

+0.26

Martin ratioReturn relative to average drawdown

12.38

8.63

+3.75

EEM vs. XLE - Sharpe Ratio Comparison

The current EEM Sharpe Ratio is 2.10, which is comparable to the XLE Sharpe Ratio of 1.82. The chart below compares the historical Sharpe Ratios of EEM and XLE, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

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Drawdowns

EEM vs. XLE - Drawdown Comparison

The maximum EEM drawdown since its inception was -66.43%, smaller than the maximum XLE drawdown of -71.26%. Use the drawdown chart below to compare losses from any high point for EEM and XLE.

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Drawdown Indicators

EEMXLEDifference

Max Drawdown

Largest peak-to-trough decline

-66.43%

-71.26%

+4.83%

Max Drawdown (1Y)

Largest decline over 1 year

-13.52%

-12.05%

-1.47%

Max Drawdown (3Y)

Largest decline over 3 years

-17.29%

-20.14%

+2.85%

Max Drawdown (5Y)

Largest decline over 5 years

-37.49%

-26.04%

-11.45%

Max Drawdown (10Y)

Largest decline over 10 years

-39.82%

-66.81%

+26.99%

Current Drawdown

Current decline from peak

-4.12%

-8.01%

+3.89%

Average Drawdown

Average peak-to-trough decline

-16.00%

-17.97%

+1.97%

Ulcer Index

Depth and duration of drawdowns from previous peaks

3.67%

4.32%

-0.65%

Volatility

EEM vs. XLE - Volatility Comparison

iShares MSCI Emerging Markets ETF (EEM) has a higher volatility of 10.80% compared to State Street Energy Select Sector SPDR ETF (XLE) at 7.26%. This indicates that EEM's price experiences larger fluctuations and is considered to be riskier than XLE based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

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Volatility by Period

EEMXLEDifference

Volatility (1M)

Calculated over the trailing 1-month period

10.80%

7.26%

+3.54%

Volatility (6M)

Calculated over the trailing 6-month period

19.39%

16.79%

+2.60%

Volatility (1Y)

Calculated over the trailing 1-year period

21.64%

20.57%

+1.07%

Volatility (5Y)

Calculated over the trailing 5-year period, annualized

19.26%

26.05%

-6.79%

Volatility (10Y)

Calculated over the trailing 10-year period, annualized

20.64%

29.58%

-8.94%

EEM vs. XLE - Expense Ratio Comparison

EEM has a 0.72% expense ratio, which is higher than XLE's 0.08% expense ratio.

Dividends

EEM vs. XLE - Dividend Comparison

EEM's dividend yield for the trailing twelve months is around 1.79%, less than XLE's 2.59% yield.

PositionTTM20252024202320222021202020192018201720162015
EEM
iShares MSCI Emerging Markets ETF		1.79%2.22%2.43%2.63%2.50%1.99%1.45%2.76%2.24%1.89%1.89%2.49%
XLE
State Street Energy Select Sector SPDR ETF		2.59%3.28%3.36%3.55%3.68%4.21%5.62%6.72%3.54%3.03%2.26%3.39%

Frequently Asked Questions

EEM and XLE have a correlation of -0.05, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

EEM has higher volatility (10.80%) compared to XLE (7.26%). In terms of maximum drawdown, EEM dropped -66.43% vs XLE's -71.26%.

On 10-year performance, XLE leads with 9.91% vs 9.91% for EEM. On fees, XLE is cheaper at 0.08% per year. On volatility, XLE has been the lower-risk option at 7.26%. The better choice depends on whether you care most about return, fees, risk, or income.

Over the 10-year period, XLE has performed better with a 9.91% return vs 9.91%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

XLE is cheaper with a 0.08% expense ratio, compared with 0.72% for EEM.

XLE has the higher dividend yield at 2.59%, compared with 1.79% for EEM.

EEM is categorized as Emerging Markets Diversified, while XLE is Energy Equities. EEM tracks MSCI Emerging Markets Index (Net), while XLE tracks Energy Select Sector Index. They also come from different issuers: iShares and State Street. Their fees differ too: 0.72% for EEM and 0.08% for XLE.

EEM currently has the higher Sharpe Ratio (2.10 vs 1.82), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.

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