SPY vs TDF: Correlation
Measured on weekly returns over the past three years, SPDR S&P 500 ETF Trust (SPY) and Templeton Dragon Fund, Inc. (TDF) carry a correlation of 0.42, a moderate link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are SPY and TDF?
Across a 3-year window, the weekly returns of SPY and TDF correlate at 0.42, moderate. The link has tightened recently: the 1-year correlation (0.70) runs above the 3-year figure (0.42). Stretching to 5 years gives 0.34, with an annualized covariance of 133.5 %².
By 3-year correlation, TDF places #991 of the 4755 assets tracked against SPY. Correlation aside, the last 12 months split them widely, with SPY ahead by 17.2 points (+20.6% versus +3.4%). Note the risk asymmetry: TDF runs 1.5 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.
SPY vs TDF: side by side
| SPY (SPDR S&P 500 ETF Trust) | TDF (Templeton Dragon Fund, Inc.) | |
|---|---|---|
| 1-year return | +20.6% | +3.4% |
| 5-year return | +82.4% | -29.3% |
| Volatility (ann.) | 14.5% | 22.2% |
| Beta vs S&P 500 | 1.00 | 0.64 |
| Max drawdown (3Y) | -18.8% | -22.2% |
| Market cap | – | $0.3B |
| P/E (trailing) | – | 3.6 |
| Dividend yield | 1.01% | 3.68% |
| Expense ratio | 0.09% | – |
| Assets under management | $795.3B | – |
| Sector / category | ETF · US Large Cap | US Listed |
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 | SPY | TDF |
|---|---|---|
| 2022 | -18.2% | -32.9% |
| 2023 | +26.2% | -20.1% |
| 2024 | +24.9% | +5.5% |
| 2025 | +17.7% | +37.7% |
| 2026 | +13.7% | -1.2% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are SPY and TDF good diversifiers for each other?
Reasonably. At 0.42, SPY and TDF keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
FAQ
What is the correlation between SPY and TDF?
As of 2026-08-27, the correlation of weekly returns between SPY and TDF is 0.42 over 3 years, 0.70 over 1 year and 0.34 over 5 years.
Is TDF a good diversifier for SPY?
Reasonably. At 0.42, SPY and TDF keep a meaningful degree of independence, and combining them has historically reduced portfolio volatility.
What does a correlation of 0.42 mean?
Correlation ranges from −1 to +1. Values near +1 mean two assets move together, near 0 that they move independently, and negative values that they tend to move in opposite directions. It measures co-movement, not performance.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/spy-vs-tdf.json
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[](https://www.pairbook.io/pair/spy-vs-tdf/)
The core API is free. Terms and every endpoint in the API documentation.
Related comparisons
Hubs: SPY correlations · TDF correlations
