In theory, an S&P fund should have a perfect positive correlation of one, which means the fund and index perform identically. However, while funds have a very high correlation coefficient, it is not a perfect correlation. Dividends, expense fees, and intraday trading on exchanges are just a few of the factors that can cause a fund's performance to vary slightly from the S&P 500 index. Comparing tracking errors is the best way to find the fund with the highest correlation coefficient.