As reported by TheMotleyFool’s Becca Lipman, the correlation between the S&P 500’s performance with that of its individual stocks has never been higher — it currently stands at 0.73.
This correlation, which is measured on a scale from -1 to 1, indicates how much an individual stock can be expected to change in market value given changes in the S&P 500. 0.73 is nothing to sneeze at.
That means member companies with fundamentals that differ from the S&P 500 find their differentiations to be increasingly irrelevant. Any upswings or downswings in the market will pull that specific stock with it, even if it is undeserving of the change.