CAT vs SPY: Correlation
Measured on weekly returns over the past three years, Caterpillar Inc. (CAT) and SPDR S&P 500 ETF Trust (SPY) carry a correlation of 0.51, a moderate link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are CAT and SPY?
On 3 years of weekly data the CAT/SPY correlation comes out at 0.51, moderate. Lately the two have drifted apart, with the 1-year correlation at 0.29 versus 0.51 over 3 years. The 5-year figure is 0.53, and annualized covariance runs at 215.0 %².
By 3-year correlation, SPY places #22 of the 36 assets tracked against CAT. Their recent paths diverged sharply: over the last 12 months CAT outperformed by 69.9 percentage points (+90.5% for CAT against +20.6% for SPY). Across three years, the rolling one-year figure varied moderately, from 0.25 to 0.74. Note the risk asymmetry: CAT runs 2.0 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
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.
CAT vs SPY: side by side
| CAT (Caterpillar Inc.) | SPY (SPDR S&P 500 ETF Trust) | |
|---|---|---|
| 1-year return | +90.5% | +20.6% |
| 5-year return | +321.1% | +82.4% |
| Volatility (ann.) | 29.4% | 14.5% |
| Beta vs S&P 500 | 1.03 | 1.00 |
| Max drawdown (3Y) | -34.0% | -18.8% |
| Market cap | $375.6B | – |
| P/E (trailing) | 35.3 | – |
| Dividend yield | 0.75% | 1.01% |
| Expense ratio | – | 0.09% |
| Assets under management | – | $795.3B |
| Sector / category | Industrials | ETF · US Large Cap |
SPY is a Large Blend fund from State Street Investment Management: $795.3B under management, 504 holdings, a 0.09% expense ratio, a 1.01% trailing dividend yield.
Year-by-year returns
| Year | CAT | SPY |
|---|---|---|
| 2022 | +18.6% | -18.2% |
| 2023 | +25.9% | +26.2% |
| 2024 | +24.7% | +24.9% |
| 2025 | +60.3% | +17.7% |
| 2026 | +43.5% | +13.7% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Fund exposure
Keep in mind that SPY holds CAT at a 0.57% weight, which makes a slice of this correlation mechanical rather than coincidental.
Are CAT and SPY good diversifiers for each other?
Somewhat, no more. With 0.51 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between CAT and SPY?
The CAT/SPY correlation stands at 0.51 on a 3-year window (1 year: 0.29, 5 years: 0.53), computed from weekly returns as of 2026-08-27.
Is SPY a good diversifier for CAT?
Somewhat, no more. With 0.51 correlation, most large moves hit both names, and the diversification benefit stays modest.
What does a correlation of 0.51 mean?
On the −1 to +1 scale, 0.51 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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Hubs: CAT correlations · SPY correlations
