LUV vs SPY: Correlation
Southwest Airlines (LUV) and SPDR S&P 500 ETF Trust (SPY) show a moderate relationship: their 3-year correlation of weekly returns is 0.40.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are LUV and SPY?
Over the past 3 years, LUV and SPY moved with a correlation of 0.40, which is moderate. The relationship has been stable: the 1-year correlation (0.35) sits close to the 3-year figure. Over 5 years the correlation is 0.42, and the annualized covariance of weekly returns is 231.9 %².
Within LUV's tracked universe of 32 assets, SPY comes in at #21 by 3-year correlation. Their 12-month results are close: +22.0% for LUV against +20.6% for SPY. Do not treat this figure as fixed: across three years the rolling one-year correlation ranged all the way from 0.01 to 0.56. One caveat on sizing: LUV is 2.8 times as volatile as the other leg, so an equal-dollar split is far from equal-risk.
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.
LUV vs SPY: side by side
| LUV (Southwest Airlines) | SPY (SPDR S&P 500 ETF Trust) | |
|---|---|---|
| 1-year return | +22.0% | +20.6% |
| 5-year return | -12.3% | +82.4% |
| Volatility (ann.) | 40.5% | 14.5% |
| Beta vs S&P 500 | 1.11 | 1.00 |
| Max drawdown (3Y) | -33.5% | -18.8% |
| Market cap | $19.5B | – |
| P/E (trailing) | 25.5 | – |
| Dividend yield | 1.77% | 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 | LUV | SPY |
|---|---|---|
| 2022 | -21.4% | -18.2% |
| 2023 | -11.8% | +26.2% |
| 2024 | +19.1% | +24.9% |
| 2025 | +25.6% | +17.7% |
| 2026 | -3.0% | +13.7% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are LUV and SPY good diversifiers for each other?
A fair diversifier. At 0.40, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
FAQ
What is the correlation between LUV and SPY?
Using weekly returns as of 2026-08-27: 0.40 over 3 years, with 0.35 over the last year and 0.42 over 5 years.
Is SPY a good diversifier for LUV?
A fair diversifier. At 0.40, enough of each asset's movement is its own that the pair has smoothed outcomes historically.
What does a correlation of 0.40 mean?
On the −1 to +1 scale, 0.40 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: LUV correlations · SPY correlations
