ASX vs. NYSE: A Decade of Returns, Volatility and Correlation

Written by James Wilson

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Last updated: April 3, 2026

Two Markets, One Question: How Different Are They Really?

If you've spent any time reading about investing, the S&P 500 probably dominates your feed. And fair enough. It's the world's most-watched equity index and tracks some of the biggest companies on the planet. But there's a market on the other side of the world that rarely gets a look-in from international investors, despite being the 14th largest stock exchange globally by market capitalisation.

The Australian Securities Exchange, or ASX, lists around 2,200 companies and carries a total market capitalisation of roughly A$2.8 trillion (about US$1.8 trillion). Compare that to the New York Stock Exchange at over US$28 trillion in listed market cap and around 2,400 domestic listings. The daily turnover gap is just as wide. The NYSE regularly clears US$40-50 billion in daily equity volume, while the ASX sits in the A$5-7 billion range on a typical day.

So we're comparing a mid-sized, resource-heavy exchange with the single largest equity marketplace in history. That's precisely what makes the comparison interesting.

We've put together a decade's worth of data (2016-2025) covering returns, volatility, correlation, dividends and currency effects. No recommendations about where to invest. Just numbers and context for why these two markets behave the way they do.

Sector Composition: The Key Difference

The answer to why these markets perform so differently is almost entirely about sector composition. Once you see the breakdown, the performance gap over the past decade makes a lot more sense.

Look at the top two lines. Financials and materials together make up over 57% of the ASX 200. On the S&P 500 side, information technology alone accounts for a third of the entire index. These are fundamentally different beasts.

When tech rallies hard (as it did in 2023 and 2024), the S&P 500 pulls away. When commodity prices surge (iron ore, gold, lithium), the ASX outperforms. Neither index is better or worse. They just dance to different music.

One odd thing we noticed while putting this together: the ASX has basically no meaningful tech exposure. Just 2.2%. For an economy that loves to talk about innovation, that's a surprisingly thin slice.

A Decade of Returns, Year by Year

Here's where the numbers tell the story. We've tracked total returns (price gains plus reinvested dividends) for both indices in their local currencies.

A few things jump out. The S&P 500 won eight out of ten years in local-currency terms. The two exceptions? 2022, when the tech wreck hammered the S&P while the ASX's commodity and banking heavyweights held up, and 2025, when materials rallied and US tech took a breather.

2020 is the starkest contrast. Both markets crashed in March that year. The ASX 200 dropped around 37% from its February peak to the March trough. The S&P 500 fell roughly 34%. But recovery is where they diverged. US tech stocks (which had already been driving the index) were turbocharged by the stay-at-home economy. The ASX, heavy on banks facing loan-loss fears and miners dealing with supply chain chaos, barely scraped a positive return for the year.

Over the full decade (2016-2025), the S&P 500 delivered a cumulative total return of approximately 270% in USD. The ASX 200 returned around 135% in AUD. That's roughly double the performance from the American market.

The USD Picture: What an American Investor Actually Earned

For a US-based investor buying ASX stocks without currency hedging, the AUD/USD exchange rate is a second layer of return (or loss).

2024 is a textbook example. The ASX returned a respectable 11.5% in local terms, but the Aussie dollar fell nearly 9% against the greenback. A US investor ended up with just 1.7% for the year. Meanwhile the S&P 500 returned 25%. That's a brutal gap.

The reverse happened in 2017 and 2020, where a rising AUD boosted returns for USD-based investors in Australian equities.

This is the key point about AUD/USD: the Australian dollar is a commodity currency. It tends to rise when iron ore, coal and other raw materials are in demand (often driven by Chinese economic activity) and fall when global risk appetite drops. So the currency doesn't just add noise. It amplifies the existing commodity tilt of the ASX.

Hedged vs. unhedged? The data over this decade suggests that leaving AUD exposure unhedged has cost US investors roughly 1-2 percentage points per year on average, mostly due to the long-term downtrend in AUD/USD from the 0.70-0.78 range to the low 0.60s.

Volatility: Different Profile, Not Necessarily Worse

Here's a metric that might surprise people who assume the smaller market is always more volatile.

The ASX 200 has actually shown lower annualised volatility than the S&P 500 over this period. That might seem counterintuitive, but the S&P's heavy tech weighting introduces more growth-stock volatility, particularly during the swings of 2020-2022.

Where the ASX falls short is recovery speed. After the COVID crash, the S&P 500 reclaimed its February 2020 high by August 2020. Just five months. The ASX 200 didn't fully recover until mid-2021. The difference? Tech stocks driving a rapid V-shaped recovery in the US, while the ASX's bank and mining stocks took longer to find their footing.

The Sharpe ratio tells the summary story. The S&P 500 delivered significantly more return per unit of risk. The ASX wasn't more dangerous. It just didn't reward investors as generously for the risk they took.

Correlation: Does the ASX Actually Diversify a US Portfolio?

This is the question that really matters for asset allocation. If the ASX moves in lockstep with the S&P 500, there's no diversification benefit.

The rolling 12-month correlation between the ASX 200 and S&P 500 has averaged around 0.65-0.75 over the past decade. That's moderately high, but not so high that the diversification argument falls apart entirely.

What's more interesting is how the correlation moves over time.

During calm markets with sector-specific drivers (a commodity boom, a tech rally), the correlation tends to drop toward 0.50 or even lower. The two indices genuinely march to their own beat when things are quiet.

During global crises, correlation spikes toward 0.90+. In March 2020, both markets fell in near-perfect sync. The same happened during the aggressive rate-hiking cycle of late 2022. When fear is the dominant emotion, everything sells off together.

The ASX actually correlates more closely with the FTSE 100 than with the S&P 500. That makes sense given the similar sector profiles. Both the UK and Australian indices are heavy on financials, mining and energy, and light on tech. The lowest correlation is with the Nikkei 225, largely because Japan's market is driven by a very different set of factors (yen dynamics, electronics, automotive).

For a US investor, the ASX provides some diversification. But it's modest, and it tends to disappear exactly when you need it most, during a broad sell-off.

The Dividend Story

This is where the ASX genuinely stands apart.

The S&P/ASX 200 has consistently offered a dividend yield of around 3.5-4.0% over the past decade, roughly triple the S&P 500's 1.2-1.5%. And there's a specific reason for that beyond just sectoral mix.

Australia's dividend imputation system, known as franking credits, means that company tax already paid on profits can be passed through to shareholders as a tax credit. The practical effect? Australian companies are strongly incentivised to pay out earnings as dividends rather than retain them or buy back shares. The big four banks (Commonwealth Bank, Westpac, ANZ, NAB) have been particularly generous dividend payers, often yielding 4-6% individually.

Contrast this with the US, where share buybacks have become the dominant way to return capital. Apple alone spent over US$90 billion on buybacks in 2024. That capital return doesn't show up in the dividend yield figure.

So the ASX is fundamentally an income market, while the S&P 500 is a growth market. Neither approach is superior. It depends entirely on what the investor needs. For retirees or income-focused portfolios, the ASX's yield is genuinely attractive, even accounting for the currency risk.

One caveat: franking credits only provide their full benefit to Australian tax residents. Foreign investors can claim some refund depending on the tax treaty between Australia and their home country, but the benefit is reduced.

Liquidity and Accessibility

The ASX operates from 10:00am to 4:00pm AEST (Australian Eastern Standard Time), which translates to roughly 7:00pm to 1:00am US Eastern Time. There's no overlap with regular NYSE trading hours at all, which can be either an advantage (you can react to US overnight moves) or an annoyance (you're trading Australian stocks at odd hours from a US perspective).

Bid-ask spreads on the largest ASX stocks (BHP, Commonwealth Bank, CSL) typically run 0.03-0.10%, comparable to large NYSE-listed stocks. But once you move into the mid-cap and small-cap ASX space, spreads widen noticeably. Liquidity thins out fast below the top 50 names.

For international investors wanting ASX access, Interactive Brokers is the most commonly used platform, offering direct access to the ASX with competitive commissions. Saxo Bank, CMC Markets and IG also provide ASX trading for non-Australian residents. Alternatively, US-listed ETFs like the iShares MSCI Australia ETF (EWA) offer indirect exposure without needing a separate brokerage account.

What the Data Shows

We deliberately haven't framed this as "which market should you invest in." That's not what the numbers are for.

What the decade of data does show is that the ASX 200 and S&P 500 are structurally different markets. The ASX is a financials-and-resources index with a strong dividend culture, lower volatility, and performance tied closely to commodity cycles and the Australian dollar. The S&P 500 is a technology-driven growth index with higher absolute returns over this period but also higher volatility and a much lower income yield.

The correlation between them is real but not overwhelming. In quiet times, the ASX provides genuine diversification from a US-centric portfolio. In crisis periods, that benefit shrinks.

The currency adds another layer. AUD/USD has broadly trended lower over the decade, eating into returns for unhedged US investors. That's a risk that's easy to underestimate.

And here's the thing that sometimes gets lost in these comparisons: the past decade has been unusually kind to US tech. The Magnificent Seven stocks alone drove a massive share of S&P 500 returns. Whether that continues for the next decade is anyone's guess. If commodity demand stays strong (driven by electrification, infrastructure spending, or Chinese stimulus) and tech growth moderates, the relative picture could look quite different.

The numbers don't predict the future. But they do a good job of explaining the past, and understanding why these two markets behave differently is worth more than any forecast.

Official Sources and Further Reading

• S&P Dow Jones Indices - S&P/ASX 200 - official index page with sector breakdowns, factsheets and performance data
• S&P Dow Jones Indices - S&P 500 - official S&P 500 index page with sector weights and historical returns
• ASX Market Statistics - trading volumes, market capitalisation and historical data from the Australian Securities Exchange
• Reserve Bank of Australia - Historical Data - exchange rate data including AUD/USD historical rates