Correlation Between New Alternatives and Vanguard Total
Can any of the company-specific risk be diversified away by investing in both New Alternatives and Vanguard Total 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 New Alternatives and Vanguard Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Alternatives Fund and Vanguard Total Stock, you can compare the effects of market volatilities on New Alternatives and Vanguard Total 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 New Alternatives with a short position of Vanguard Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Alternatives and Vanguard Total.
Diversification Opportunities for New Alternatives and Vanguard Total
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between New and Vanguard is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding New Alternatives Fund and Vanguard Total Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Total Stock and New Alternatives 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 New Alternatives Fund are associated (or correlated) with Vanguard Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Total Stock has no effect on the direction of New Alternatives i.e., New Alternatives and Vanguard Total go up and down completely randomly.
Pair Corralation between New Alternatives and Vanguard Total
Assuming the 90 days horizon New Alternatives Fund is expected to under-perform the Vanguard Total. In addition to that, New Alternatives is 1.28 times more volatile than Vanguard Total Stock. It trades about -0.01 of its total potential returns per unit of risk. Vanguard Total Stock is currently generating about 0.11 per unit of volatility. If you would invest 9,442 in Vanguard Total Stock on August 26, 2024 and sell it today you would earn a total of 4,996 from holding Vanguard Total Stock or generate 52.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Alternatives Fund vs. Vanguard Total Stock
Performance |
| Timeline |
| New Alternatives |
| Vanguard Total Stock |
New Alternatives and Vanguard Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Alternatives and Vanguard Total
The main advantage of trading using opposite New Alternatives and Vanguard Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Alternatives position performs unexpectedly, Vanguard Total 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 Total will offset losses from the drop in Vanguard Total's long position.| New Alternatives vs. Guinness Atkinson Alternative | New Alternatives vs. Calvert Global Energy | New Alternatives vs. Portfolio 21 Global | New Alternatives vs. Green Century Balanced |
| Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Total Bond | Vanguard Total vs. Vanguard 500 Index | Vanguard Total vs. Vanguard Reit Index |
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.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |