Correlation Between Vanguard Pennsylvania and Intermediate-term
Can any of the company-specific risk be diversified away by investing in both Vanguard Pennsylvania and Intermediate-term at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Vanguard Pennsylvania and Intermediate-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Pennsylvania Long Term and Intermediate Term Bond Fund, you can compare the effects of market volatilities on Vanguard Pennsylvania and Intermediate-term and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Vanguard Pennsylvania with a short position of Intermediate-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Pennsylvania and Intermediate-term.
Diversification Opportunities for Vanguard Pennsylvania and Intermediate-term
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and Intermediate-term is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Pennsylvania Long Ter and Intermediate Term Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Term Bond and Vanguard Pennsylvania is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Vanguard Pennsylvania Long Term are associated (or correlated) with Intermediate-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Term Bond has no effect on the direction of Vanguard Pennsylvania i.e., Vanguard Pennsylvania and Intermediate-term go up and down completely randomly.
Pair Corralation between Vanguard Pennsylvania and Intermediate-term
Assuming the 90 days horizon Vanguard Pennsylvania Long Term is expected to generate 0.84 times more return on investment than Intermediate-term. However, Vanguard Pennsylvania Long Term is 1.19 times less risky than Intermediate-term. It trades about 0.46 of its potential returns per unit of risk. Intermediate Term Bond Fund is currently generating about 0.24 per unit of risk. If you would invest 1,022 in Vanguard Pennsylvania Long Term on July 21, 2025 and sell it today you would earn a total of 61.00 from holding Vanguard Pennsylvania Long Term or generate 5.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Pennsylvania Long Ter vs. Intermediate Term Bond Fund
Performance |
| Timeline |
| Vanguard Pennsylvania |
| Intermediate Term Bond |
Vanguard Pennsylvania and Intermediate-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Pennsylvania and Intermediate-term
The main advantage of trading using opposite Vanguard Pennsylvania and Intermediate-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Pennsylvania position performs unexpectedly, Intermediate-term can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Intermediate-term will offset losses from the drop in Intermediate-term's long position.| Vanguard Pennsylvania vs. JPMorgan Municipal | Vanguard Pennsylvania vs. Vanguard New Jersey | Vanguard Pennsylvania vs. iShares Intermediate GovernmentCredit | Vanguard Pennsylvania vs. VanEck JP Morgan |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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