Stock Index Correlations

Mutual Funds . USA . 
Fund . Stock Index Fund
HSTIX Fund  USD 43.95  0.25  0.57%   
The current 90-days correlation between Stock Index Fund and Value Fund Value is 0.84 (i.e., Very poor diversification). The correlation of Stock Index 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.

Stock Index Correlation With Market

Very poor diversification

The correlation between Stock Index Fund and DJI is 0.83 (i.e., Very poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Stock Index Fund and DJI in the same portfolio, assuming nothing else is changed.
  
Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Stock Index 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 gross domestic product.

Moving together with Stock Mutual Fund

  0.98HNASX Growth Fund GrowthPairCorr
  0.96HOVLX Value Fund ValuePairCorr
  0.93HSCSX Small-company StockPairCorr
  1.0VTSAX Vanguard Total StockPairCorr
  0.96VFIAX Vanguard 500 IndexPairCorr
  1.0VTSMX Vanguard Total StockPairCorr
  1.0VITSX Vanguard Total StockPairCorr
  1.0VSMPX Vanguard Total StockPairCorr
  1.0VSTSX Vanguard Total StockPairCorr
  1.0VFINX Vanguard 500 IndexPairCorr
  1.0VFFSX Vanguard 500 IndexPairCorr
  1.0VINIX Vanguard InstitutionalPairCorr
  1.0VIIIX Vanguard InstitutionalPairCorr
  0.61WRHIX Ivy High IncomePairCorr
  0.62WHIAX Ivy High IncomePairCorr
  0.66IHIFX Ivy High IncomePairCorr
  0.67IVHIX Ivy High IncomePairCorr
  0.63FMSGX Frontier Mfg GlobalPairCorr
  0.69EOD Allspring Global DividendPairCorr
  0.97AMGOX Alger Mid CapPairCorr
  0.99TAAIX Thrivent AggressivePairCorr
  0.99VIGAX Vanguard Growth IndexPairCorr
  0.92RYMDX Mid Cap 15xPairCorr
  0.99FBALX Fidelity BalancedPairCorr
  0.86PCF Putnam High IncomePairCorr
  0.62FXIFX Fidelity Freedom IndexPairCorr
  0.96TRLCX Tiaa-cref Large-capPairCorr
  0.81MERDX Meridian GrowthPairCorr
  0.71JRI Nuveen Real AssetPairCorr
  0.94NBGIX Neuberger Berman GenesisPairCorr

Moving against Stock Mutual Fund

  0.71HOIBX Homestead IntermediatePairCorr
  0.64HOSGX Short Term GovernmentPairCorr
  0.56HOSBX Short Term BondPairCorr
  0.46HISIX International EquityPairCorr
  0.6LIIAX Columbia Porate IncomePairCorr
  0.58SRINX Columbia Porate IncomePairCorr
  0.52CIFRX Columbia Porate IncomePairCorr

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   
HSCSX
+ 0.94
HOVLX
HSCSX
+ 0.94
HNASX
HNASX
+ 0.93
HOVLX
HOSBX
+ 0.62
HISIX
  
High negative correlations   
HOSBX
- 0.62
HNASX
HSCSX
- 0.61
HOSBX
HSCSX
- 0.59
HISIX
HISIX
- 0.55
HNASX
HOSBX
- 0.48
HOVLX
HISIX
- 0.41
HOVLX

Risk-Adjusted Indicators

There is a big difference between Stock Mutual Fund performing well and Stock Index 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 Stock Index'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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