Government Bond Correlations

Mutual Funds . USA . 
Fund . Government Bond Fund
CPTNX Fund  USD 9.23  0.01  0.11%   
The current 90-days correlation between Government Bond and Inflation Adjusted Bond Fund is 0.82 (i.e., Very poor diversification). The correlation of Government Bond is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

Government Bond Correlation With Market

Modest diversification

The correlation between Government Bond Fund and DJI is 0.24 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Government Bond Fund and DJI in the same portfolio, assuming nothing else is changed.
  
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Government Bond Fund. Also, note that the market value of any mutual fund could be closely tied with the direction of predictive economic indicators such as signals in board of governors.

Moving together with Government Mutual Fund

  0.78AMDVX Mid Cap ValuePairCorr
  0.66AMGIX Income GrowthPairCorr
  0.99CDBCX Diversified BondPairCorr
  0.73TWADX Value Fund APairCorr
  0.7TWCCX Ultra Fund CPairCorr
  0.63TWCAX Select Fund APairCorr
  0.62TWCIX Select Fund InvestorPairCorr
  0.71TWCGX Growth Fund InvestorPairCorr
  0.78AMVYX Mid Cap ValuePairCorr
  0.74AMVRX Mid Cap ValuePairCorr
  0.74AMVGX Mid Cap ValuePairCorr
  0.72TWEAX Equity IncomePairCorr
  0.72TWEIX Equity IncomePairCorr
  0.7TWGAX International GrowthPairCorr
  0.69TWGIX Growth Fund IPairCorr
  0.74TWGGX Global GrowthPairCorr
  0.72TWIEX International GrowthPairCorr
  0.78TWHIX Heritage Fund InvestorPairCorr
  0.76TWRCX Growth Fund CPairCorr
  0.86TWTCX Intermediate Term TaxPairCorr
  0.8TWTIX Intermediate Term TaxPairCorr
  0.82TWSCX Strategic Allocation:PairCorr
  0.82TWSAX Strategic Allocation:PairCorr
  0.84TWSMX Strategic Allocation:PairCorr
  0.73TWVLX Value Fund InvestorPairCorr
  0.82TWWOX Intermediate Term TaxPairCorr

Related Correlations Analysis

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.
High positive correlations   
ADFIX
+ 0.99
BGNMX
ADFIX
+ 0.9
ACITX
BGNMX
+ 0.89
ACITX
TWBIX
+ 0.66
BGNMX
TWBIX
+ 0.64
ADFIX
TWBIX
+ 0.56
ACITX
  
High negative correlations   
TWUSX
- 0.01
ACITX

Risk-Adjusted Indicators

There is a big difference between Government Mutual Fund performing well and Government Bond Mutual Fund doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Government Bond's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

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