LUV vs ULCC: Correlation
Southwest Airlines (LUV) and Frontier Group Holdings, Inc. (ULCC) show a moderate relationship: their 3-year correlation of weekly returns is 0.55.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are LUV and ULCC?
On 3 years of weekly data the LUV/ULCC correlation comes out at 0.55, moderate. The link has tightened recently: the 1-year correlation (0.67) runs above the 3-year figure (0.55). The 5-year figure is 0.56, and annualized covariance runs at 1812.4 %².
Among the 32 assets we track against LUV, ULCC ranks #11 by 3-year correlation. Neither side won the trailing year by much: +22.0% against +23.4%. Note the risk asymmetry: ULCC 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.
LUV vs ULCC: side by side
| LUV (Southwest Airlines) | ULCC (Frontier Group Holdings, Inc.) | |
|---|---|---|
| 1-year return | +22.0% | +23.4% |
| 5-year return | -12.3% | -61.9% |
| Volatility (ann.) | 40.5% | 81.0% |
| Beta vs S&P 500 | 1.11 | 2.06 |
| Max drawdown (3Y) | -33.5% | -70.4% |
| Market cap | $19.5B | $1.4B |
| P/E (trailing) | 25.5 | – |
| Dividend yield | 1.77% | 0.00% |
| Sector / category | Industrials | US Listed |
Year-by-year returns
| Year | LUV | ULCC |
|---|---|---|
| 2022 | -21.4% | -24.3% |
| 2023 | -11.8% | -46.8% |
| 2024 | +19.1% | +30.2% |
| 2025 | +25.6% | -33.8% |
| 2026 | -3.0% | +25.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are LUV and ULCC good diversifiers for each other?
To a limited degree. At 0.55 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
FAQ
What is the correlation between LUV and ULCC?
The LUV/ULCC correlation stands at 0.55 on a 3-year window (1 year: 0.67, 5 years: 0.56), computed from weekly returns as of 2026-08-27.
Is ULCC a good diversifier for LUV?
To a limited degree. At 0.55 the two still catch most of the same waves, so the pair smooths returns a little without insulating either from a shared selloff.
What does a correlation of 0.55 mean?
On the −1 to +1 scale, 0.55 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.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/luv-vs-ulcc.json
Markdown for the live badge, attribution link included:
[](https://www.pairbook.io/pair/luv-vs-ulcc/)
The core API is free. Terms and every endpoint in the API documentation.
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Hubs: LUV correlations · ULCC correlations
