CAT's Bigger Swings May Be Adding to Your Market Risk

Caterpillar (CAT) has been outperforming the S&P 500 in recent times, rising 2.3% over the last five sessions while the index fell 1.2%. However, this increased volatility may also mean that CAT is adding to your market risk.

A closer look at the data shows that CAT moved further than the S&P 500 on both up and down days over the past year. On an average down day, the index lost 0.61%, while CAT lost 0.79%. This translates to a loss of about $79 for every $10,000 holding.

On the other hand, on an average up day, the index gained 0.63%, while CAT gained 1.16%. This added about $116 to the value of the same holding, indicating that CAT takes a bigger share of the market's rises than its falls.