Correlation shows how closely two variables move in relation to one another. In investing, this relationship is expressed numerically and ranges between -1.0 and 1.0.
A correlation of 1 is a perfect positive correlation. In this case, as one security moves, the other security moves in the same direction by the same percentage.
A correlation of -1 is a perfect negative correlation. As one security moves, the other moves in the opposite direction.
A zero correlation implies no relationship between the two securities.