Correlation Between Vanguard Total and Vanguard Multi
Can any of the company-specific risk be diversified away by investing in both Vanguard Total and Vanguard Multi 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 Total and Vanguard Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Total Stock and Vanguard Multi Sector Income, you can compare the effects of market volatilities on Vanguard Total and Vanguard Multi 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 Total with a short position of Vanguard Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Vanguard Multi.
Diversification Opportunities for Vanguard Total and Vanguard Multi
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Vanguard is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and Vanguard Multi Sector Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Multi Sector and Vanguard Total 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 Total Stock are associated (or correlated) with Vanguard Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Multi Sector has no effect on the direction of Vanguard Total i.e., Vanguard Total and Vanguard Multi go up and down completely randomly.
Pair Corralation between Vanguard Total and Vanguard Multi
Considering the 90-day investment horizon Vanguard Total Stock is expected to generate 4.94 times more return on investment than Vanguard Multi. However, Vanguard Total is 4.94 times more volatile than Vanguard Multi Sector Income. It trades about 0.07 of its potential returns per unit of risk. Vanguard Multi Sector Income is currently generating about 0.14 per unit of risk. If you would invest 31,721 in Vanguard Total Stock on August 26, 2025 and sell it today you would earn a total of 1,143 from holding Vanguard Total Stock or generate 3.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Total Stock vs. Vanguard Multi Sector Income
Performance |
| Timeline |
| Vanguard Total Stock |
| Vanguard Multi Sector |
Vanguard Total and Vanguard Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Total and Vanguard Multi
The main advantage of trading using opposite Vanguard Total and Vanguard Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Total position performs unexpectedly, Vanguard Multi 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 Vanguard Multi will offset losses from the drop in Vanguard Multi's long position.| Vanguard Total vs. Strategy Shares | Vanguard Total vs. Freedom Day Dividend | Vanguard Total vs. Franklin Templeton ETF | Vanguard Total vs. iShares MSCI China |
| Vanguard Multi vs. Valued Advisers Trust | Vanguard Multi vs. Columbia Diversified Fixed | Vanguard Multi vs. Principal Exchange Traded Funds | Vanguard Multi vs. MFS Active Core |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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