TIP vs. XLY
TIP (iShares TIPS Bond ETF) and XLY (Consumer Discretionary Select Sector SPDR Fund) are both exchange-traded funds - TIP is a Inflation-Protected Bonds fund tracking the ICE U.S. Treasury Inflation Linked Bond Index, while XLY is a Consumer Discretionary Equities fund tracking the Consumer Discretionary Select Sector Index. Both are passively managed. Over the past 10 years, TIP returned 2.50%/yr vs 12.72%/yr for XLY. At a correlation of -0.09, they often move in opposite directions. TIP charges 0.18%/yr vs 0.13%/yr for XLY.
Performance
TIP vs. XLY - Performance Comparison
Loading charts...
Returns By Period
In the year-to-date period, TIP achieves a 1.39% return, which is significantly higher than XLY's -2.41% return. Over the past 10 years, TIP has underperformed XLY with an annualized return of 2.50%, while XLY has yielded a comparatively higher 12.72% annualized return.
TIP
- 1D
- 0.36%
- 1M
- -0.22%
- YTD
- 1.39%
- 6M
- 1.25%
- 1Y
- 4.90%
- 3Y*
- 3.82%
- 5Y*
- 0.91%
- 10Y*
- 2.50%
XLY
- 1D
- 2.48%
- 1M
- -1.68%
- YTD
- -2.41%
- 6M
- -2.84%
- 1Y
- 9.18%
- 3Y*
- 13.28%
- 5Y*
- 6.94%
- 10Y*
- 12.72%
TIP vs. XLY - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
TIP iShares TIPS Bond ETF | 1.39% | 6.77% | 1.65% | 3.80% | -12.26% | 5.68% | 10.84% | 8.35% | -1.42% | 2.92% |
XLY Consumer Discretionary Select Sector SPDR Fund | -2.41% | 7.37% | 26.51% | 39.64% | -36.27% | 27.93% | 29.63% | 28.39% | 1.58% | 22.82% |
Correlation
The correlation between TIP and XLY is 0.22, which is low. Their price movements are largely independent, making them effective diversification partners.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.22 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.21 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.18 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.08 |
Correlation (All Time) Calculated using the full available price history since Dec 5, 2003 | -0.09 |
The correlation between TIP and XLY shifts across timeframes, from -0.09 (all time) to 0.22 (1 year), reflecting how their relationship changes across market environments.
Compare stocks, funds, or ETFs
Search for stocks, ETFs, and funds for a quick comparison or use the comparison tool for more options.
Return for Risk
TIP vs. XLY — Risk / Return Rank
TIP
XLY
TIP vs. XLY - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares TIPS Bond ETF (TIP) and Consumer Discretionary Select Sector SPDR Fund (XLY). 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.
| TIP | XLY | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.95 | ||
| Sortino ratioReturn per unit of downside risk | +1.41 | ||
| Omega ratioGain probability vs. loss probability | 1.26 | 1.10 | +0.16 |
| Calmar ratioReturn relative to maximum drawdown | 2.49 | 0.62 | +1.87 |
| Martin ratioReturn relative to average drawdown | 7.44 | 1.89 | +5.55 |
Loading charts...
Drawdowns
TIP vs. XLY - Drawdown Comparison
The maximum TIP drawdown since its inception was -14.57%, smaller than the maximum XLY drawdown of -59.05%. Use the drawdown chart below to compare losses from any high point for TIP and XLY.
Loading charts...
Drawdown Indicators
| TIP | XLY | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -14.57% | -59.05% | +44.48% |
Max Drawdown (1Y)Largest decline over 1 year | -1.98% | -14.98% | +13.00% |
Max Drawdown (3Y)Largest decline over 3 years | -4.54% | -26.01% | +21.47% |
Max Drawdown (5Y)Largest decline over 5 years | -14.51% | -39.67% | +25.16% |
Max Drawdown (10Y)Largest decline over 10 years | -14.51% | -39.67% | +25.16% |
Current DrawdownCurrent decline from peak | -0.47% | -6.41% | +5.94% |
Average DrawdownAverage peak-to-trough decline | -3.43% | -9.55% | +6.12% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.66% | 4.86% | -4.20% |
Volatility
TIP vs. XLY - Volatility Comparison
The current volatility for iShares TIPS Bond ETF (TIP) is 1.03%, while Consumer Discretionary Select Sector SPDR Fund (XLY) has a volatility of 6.20%. This indicates that TIP experiences smaller price fluctuations and is considered to be less risky than XLY based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
Loading charts...
Volatility by Period
| TIP | XLY | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.03% | 6.20% | -5.17% |
Volatility (6M)Calculated over the trailing 6-month period | 2.35% | 13.52% | -11.17% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.39% | 18.29% | -14.90% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.21% | 23.84% | -17.63% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 5.74% | 22.08% | -16.34% |
TIP vs. XLY - Expense Ratio Comparison
TIP has a 0.18% expense ratio, which is higher than XLY's 0.13% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
Dividends
TIP vs. XLY - Dividend Comparison
TIP's dividend yield for the trailing twelve months is around 3.76%, more than XLY's 0.77% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
TIP iShares TIPS Bond ETF | 3.76% | 3.46% | 2.52% | 2.73% | 6.96% | 4.28% | 1.17% | 1.75% | 2.71% | 2.07% | 1.48% | 0.34% |
XLY Consumer Discretionary Select Sector SPDR Fund | 0.77% | 0.79% | 0.72% | 0.78% | 1.00% | 0.53% | 0.82% | 1.28% | 1.34% | 1.20% | 1.71% | 1.43% |
Frequently Asked Questions
TIP and XLY have a correlation of 0.22, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
XLY has higher volatility (6.20%) compared to TIP (1.03%). In terms of maximum drawdown, TIP dropped -14.57% vs XLY's -59.05%.
On 10-year performance, XLY leads with 12.72% vs 2.50% for TIP. On fees, XLY is cheaper at 0.13% per year. On volatility, TIP has been the lower-risk option at 1.03%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, XLY has performed better with a 12.72% return vs 2.50%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
XLY is cheaper with a 0.13% expense ratio, compared with 0.18% for TIP.
TIP has the higher dividend yield at 3.76%, compared with 0.77% for XLY.
TIP is categorized as Inflation-Protected Bonds, while XLY is Consumer Discretionary Equities. TIP tracks ICE U.S. Treasury Inflation Linked Bond Index, while XLY tracks Consumer Discretionary Select Sector Index. They also come from different issuers: iShares and State Street. Their fees differ too: 0.18% for TIP and 0.13% for XLY.
TIP currently has the higher Sharpe Ratio (1.45 vs 0.50), 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.
Find the right allocation for TIP and XLY
Add both to a portfolio and optimize allocations for your target — whether that's maximizing returns, minimizing drawdowns, or balancing risk across holdings.
Open Portfolio Optimizer