Correlation Between Vanguard Total and Aggressive Investors
Can any of the company-specific risk be diversified away by investing in both Vanguard Total and Aggressive Investors 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 Aggressive Investors 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 Aggressive Investors 1, you can compare the effects of market volatilities on Vanguard Total and Aggressive Investors 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 Aggressive Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Aggressive Investors.
Diversification Opportunities for Vanguard Total and Aggressive Investors
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and Aggressive is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and Aggressive Investors 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aggressive Investors 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 Aggressive Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aggressive Investors has no effect on the direction of Vanguard Total i.e., Vanguard Total and Aggressive Investors go up and down completely randomly.
Pair Corralation between Vanguard Total and Aggressive Investors
Assuming the 90 days horizon Vanguard Total is expected to generate 1.16 times less return on investment than Aggressive Investors. But when comparing it to its historical volatility, Vanguard Total Stock is 1.14 times less risky than Aggressive Investors. It trades about 0.06 of its potential returns per unit of risk. Aggressive Investors 1 is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 9,566 in Aggressive Investors 1 on May 30, 2025 and sell it today you would earn a total of 1,250 from holding Aggressive Investors 1 or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.2% |
| Values | Daily Returns |
Vanguard Total Stock vs. Aggressive Investors 1
Performance |
| Timeline |
| Vanguard Total Stock |
| Aggressive Investors |
Vanguard Total and Aggressive Investors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Total and Aggressive Investors
The main advantage of trading using opposite Vanguard Total and Aggressive Investors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Total position performs unexpectedly, Aggressive Investors 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 Aggressive Investors will offset losses from the drop in Aggressive Investors' long position.| Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Total Bond | Vanguard Total vs. Vanguard 500 Index | Vanguard Total vs. Vanguard Reit Index |
| Aggressive Investors vs. Ms Global Fixed | Aggressive Investors vs. Morningstar Global Income | Aggressive Investors vs. Calvert Global Energy | Aggressive Investors vs. Alliancebernstein Global Highome |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |