Below we highlight a list of the S&P 500 stocks that have been the most and least correlated with the Dow Jones Industrial Average over the last six months (using daily % change). As shown, not one stock in the S&P 500 has an inverse correlation with the Dow, but Goodrich (GR) has a correlation of 0.04, which means the two are very close to being completely uncorrelated. Netflix (NFLX) is the second least correlated stock in the S&P 500 with the Dow at 0.23. Honeywell (HON) is the most correlated stock with the Dow at 0.93, followed by Loews (L), 3M (MMM), Exxon Mobil (XOM), Caterpillar (CAT), Nucor (NUE) and PPG Industries (PPG). 3M, Exxon and Caterpillar are all Dow members, but the others we mentioned are not.
Out of S&P 500 stocks, Apple (AAPL) is the 40th least correlated with the Dow at 0.55. There has been lots of talk lately about Apple being its own asset class. With that in mind, below we highlight the stock's correlation with other asset classes over the last six months. As shown, Apple is the most highly correlated with the Nasdaq 100 at 0.76, which is not surprising given its huge weighting in the index. Among the ten S&P 500 sectors, the stock is the most highly correlated with the Technology sector, followed by Consumer Discretionary and Industrials. It is the least correlated with the Financial sector at 0.49.
Apple is inversely correlated with two asset classes -- the Dollar Index and the Long Bond future. The asset class that comes closest to having a zero correlation with Apple is Gold at 0.16.
For Apple to be considered its own asset class, its correlation with other asset classes should be trending lower. However, that has not really been the case. Below are charts showing Apple's rolling 6-month correlation with eight asset classes over the last five years. While correlation with the major equity indices has dropped over the past few weeks as Apple went parabolic, it's still much higher than it was five years ago. And Apple's correlation with gold and oil has actually picked up significantly over the last six months. The stock's correlation with oil is currently as high as it has been over the past five years.
Among other stocks (in the Russell 1,000), priceline.com (PCLN) has been the most highly correlated stock with Apple over the last six months at 0.66. Las Vegas Sands (LVS) and QUALCOMM (QCOM) rank second at 0.65, followed by CA and Chipotle Mexican Grill (CMG) at 0.64.
Clearwire (CLWR) is the only stock in the Russell 1,000 that has had a negative correlation with Apple over the last six months. Dendreon (DNDN), WebMD (WBMD), Education Management (EDMC) and Sears Holdings (SHLD) round out the top five least correlated stocks with Apple.
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