AEP vs SO: Correlation
How closely do American Electric Power (AEP) and Southern Company (SO) trade together? Their weekly returns over three years give a correlation of 0.75, which is strong.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are AEP and SO?
Across a 3-year window, the weekly returns of AEP and SO correlate at 0.75, strong. Recent behaviour matches the longer record: 0.80 over 1 year against 0.75 over 3. Stretching to 5 years gives 0.81, with an annualized covariance of 235.5 %².
Among the 36 assets we track against AEP, SO ranks #6 by 3-year correlation. The trailing year gives AEP the advantage: +12.1% versus -1.4%, a 13.5-point spread. The rolling one-year correlation stayed in a tight band between 0.63 and 0.84 over the past three years, which points to a structural rather than episodic relationship.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
AEP vs SO: side by side
| AEP (American Electric Power) | SO (Southern Company) | |
|---|---|---|
| 1-year return | +12.1% | -1.4% |
| 5-year return | +63.9% | +62.6% |
| Volatility (ann.) | 18.9% | 16.5% |
| Beta vs S&P 500 | -0.01 | -0.02 |
| Max drawdown (3Y) | -13.1% | -15.0% |
| Market cap | $66.8B | $102.4B |
| P/E (trailing) | 21.4 | 21.7 |
| Dividend yield | 3.06% | 3.32% |
| Sector / category | Utilities | Utilities |
Year-by-year returns
| Year | AEP | SO |
|---|---|---|
| 2022 | +10.4% | +8.2% |
| 2023 | -11.0% | +2.2% |
| 2024 | +18.2% | +21.7% |
| 2025 | +29.4% | +9.5% |
| 2026 | +8.9% | +4.6% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are AEP and SO good diversifiers for each other?
Somewhat, no more. With 0.75 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between AEP and SO?
As of 2026-08-27, the correlation of weekly returns between AEP and SO is 0.75 over 3 years, 0.80 over 1 year and 0.81 over 5 years.
Is SO a good diversifier for AEP?
Somewhat, no more. With 0.75 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.75 mean?
On the −1 to +1 scale, 0.75 describes how much the two returns move together: +1 is lockstep, 0 is independence, negative values mean opposite directions. It says nothing about which performed better.
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Related comparisons
Hubs: AEP correlations · SO correlations
