In the above example, Apple and the S&P 500 have a correlation coefficient of 0.73817, which indicates a strong relationship between the two over 90 days of data.

In our example, we find Pearson’s correlation coefficient to be r = − 0.94. We can interpret this as evidence of strong negative correlation given that r is a negative value and close to − 1. Step ...

Example of using correlation coefficients. Let's say you own three ASX shares, which we'll call Company A, Company B, and Company C. All three are growth stocks in the technology space.

Most often correlation coefficient values range between -1.0 and 1.0, ... For example, a large-cap U.S. equity fund would probably use the S&P 500 as its benchmark for correlation values, ...

This is reflected in the results of a correlation test. The correlation coefficients of Shell versus WTI, Brent, and Henry Hub natural gas prices stand at 0.83, 0.79, and 0.60, respectively.