IYR vs. XLB
IYR (iShares U.S. Real Estate ETF) and XLB (Materials Select Sector SPDR ETF) are both exchange-traded funds - IYR is a REIT fund tracking the Dow Jones U.S. Real Estate Index, while XLB is a Materials fund tracking the Materials Select Sector Index. Both are passively managed. Over the past 10 years, IYR returned 5.97%/yr vs 10.54%/yr for XLB. A 0.55 correlation means they provide meaningful diversification when combined. IYR charges 0.42%/yr vs 0.13%/yr for XLB.
Performance
IYR vs. XLB - Performance Comparison
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Returns By Period
In the year-to-date period, IYR achieves a 11.47% return, which is significantly lower than XLB's 15.57% return. Over the past 10 years, IYR has underperformed XLB with an annualized return of 5.97%, while XLB has yielded a comparatively higher 10.54% annualized return.
IYR
- 1D
- 0.89%
- 1M
- 3.00%
- YTD
- 11.47%
- 6M
- 11.46%
- 1Y
- 12.40%
- 3Y*
- 9.71%
- 5Y*
- 2.47%
- 10Y*
- 5.97%
XLB
- 1D
- 1.87%
- 1M
- 0.99%
- YTD
- 15.57%
- 6M
- 16.68%
- 1Y
- 21.77%
- 3Y*
- 10.88%
- 5Y*
- 6.01%
- 10Y*
- 10.54%
IYR vs. XLB - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IYR iShares U.S. Real Estate ETF | 11.47% | 3.38% | 4.41% | 11.89% | -25.51% | 38.74% | -5.23% | 28.21% | -4.33% | 9.31% |
XLB Materials Select Sector SPDR ETF | 15.57% | 9.94% | 0.15% | 12.46% | -12.30% | 27.44% | 20.46% | 24.13% | -14.88% | 24.01% |
Correlation
The correlation between IYR and XLB is 0.53, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.53 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.60 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.63 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.55 |
Correlation (All Time) Calculated using the full available price history since Jun 19, 2000 | 0.55 |
The correlation between IYR and XLB has been stable across timeframes, ranging from 0.53 to 0.63 - a consistent structural relationship.
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Return for Risk
IYR vs. XLB — Risk / Return Rank
IYR
XLB
IYR vs. XLB - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares U.S. Real Estate ETF (IYR) and Materials Select Sector SPDR ETF (XLB). 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.
| IYR | XLB | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.33 | ||
| Sortino ratioReturn per unit of downside risk | -0.50 | ||
| Omega ratioGain probability vs. loss probability | 1.15 | 1.20 | -0.05 |
| Calmar ratioReturn relative to maximum drawdown | 1.34 | 1.65 | -0.31 |
| Martin ratioReturn relative to average drawdown | 4.19 | 5.05 | -0.86 |
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Drawdowns
IYR vs. XLB - Drawdown Comparison
The maximum IYR drawdown since its inception was -74.13%, which is greater than XLB's maximum drawdown of -59.83%. Use the drawdown chart below to compare losses from any high point for IYR and XLB.
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Drawdown Indicators
| IYR | XLB | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -74.13% | -59.83% | -14.30% |
Max Drawdown (1Y)Largest decline over 1 year | -8.54% | -12.38% | +3.84% |
Max Drawdown (3Y)Largest decline over 3 years | -17.52% | -23.17% | +5.65% |
Max Drawdown (5Y)Largest decline over 5 years | -33.75% | -24.72% | -9.03% |
Max Drawdown (10Y)Largest decline over 10 years | -42.32% | -37.27% | -5.05% |
Current DrawdownCurrent decline from peak | 0.00% | -2.25% | +2.25% |
Average DrawdownAverage peak-to-trough decline | -12.89% | -10.83% | -2.06% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 2.73% | 4.04% | -1.31% |
Volatility
IYR vs. XLB - Volatility Comparison
The current volatility for iShares U.S. Real Estate ETF (IYR) is 4.80%, while Materials Select Sector SPDR ETF (XLB) has a volatility of 7.05%. This indicates that IYR experiences smaller price fluctuations and is considered to be less risky than XLB based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| IYR | XLB | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 4.80% | 7.05% | -2.25% |
Volatility (6M)Calculated over the trailing 6-month period | 9.87% | 13.58% | -3.71% |
Volatility (1Y)Calculated over the trailing 1-year period | 13.58% | 17.49% | -3.91% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 18.76% | 19.06% | -0.30% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 20.34% | 20.70% | -0.36% |
IYR vs. XLB - Expense Ratio Comparison
IYR has a 0.42% expense ratio, which is higher than XLB's 0.13% expense ratio.
Dividends
IYR vs. XLB - Dividend Comparison
IYR's dividend yield for the trailing twelve months is around 2.15%, more than XLB's 1.68% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IYR iShares U.S. Real Estate ETF | 2.15% | 2.48% | 2.57% | 2.75% | 2.92% | 2.06% | 2.58% | 3.05% | 3.53% | 3.73% | 4.41% | 3.92% |
XLB Materials Select Sector SPDR ETF | 1.68% | 1.92% | 1.92% | 2.00% | 2.26% | 1.62% | 1.72% | 1.98% | 2.20% | 1.66% | 1.95% | 2.24% |
Frequently Asked Questions
IYR and XLB have a correlation of 0.53, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
XLB has higher volatility (7.05%) compared to IYR (4.80%). In terms of maximum drawdown, IYR dropped -74.13% vs XLB's -59.83%.
On 10-year performance, XLB leads with 10.54% vs 5.97% for IYR. On fees, XLB is cheaper at 0.13% per year. On volatility, IYR has been the lower-risk option at 4.80%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, XLB has performed better with a 10.54% return vs 5.97%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
XLB is cheaper with a 0.13% expense ratio, compared with 0.42% for IYR.
IYR has the higher dividend yield at 2.15%, compared with 1.68% for XLB.
IYR is categorized as REIT, while XLB is Materials. IYR tracks Dow Jones U.S. Real Estate Index, while XLB tracks Materials Select Sector Index. They also come from different issuers: iShares and State Street. Their fees differ too: 0.42% for IYR and 0.13% for XLB.
XLB currently has the higher Sharpe Ratio (1.17 vs 0.84), 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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