Correlation Between Vanguard Growth and ClearBridge Large
Can any of the company-specific risk be diversified away by investing in both Vanguard Growth and ClearBridge Large 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 Growth and ClearBridge Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Growth Index and ClearBridge Large Cap, you can compare the effects of market volatilities on Vanguard Growth and ClearBridge Large 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 Growth with a short position of ClearBridge Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Growth and ClearBridge Large.
Diversification Opportunities for Vanguard Growth and ClearBridge Large
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Vanguard and ClearBridge is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Growth Index and ClearBridge Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClearBridge Large Cap and Vanguard Growth 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 Growth Index are associated (or correlated) with ClearBridge Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClearBridge Large Cap has no effect on the direction of Vanguard Growth i.e., Vanguard Growth and ClearBridge Large go up and down completely randomly.
Pair Corralation between Vanguard Growth and ClearBridge Large
Considering the 90-day investment horizon Vanguard Growth Index is expected to generate 1.09 times more return on investment than ClearBridge Large. However, Vanguard Growth is 1.09 times more volatile than ClearBridge Large Cap. It trades about 0.11 of its potential returns per unit of risk. ClearBridge Large Cap is currently generating about 0.12 per unit of risk. If you would invest 23,031 in Vanguard Growth Index on August 23, 2024 and sell it today you would earn a total of 17,364 from holding Vanguard Growth Index or generate 75.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Growth Index vs. ClearBridge Large Cap
Performance |
| Timeline |
| Vanguard Growth Index |
| ClearBridge Large Cap |
Vanguard Growth and ClearBridge Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Growth and ClearBridge Large
The main advantage of trading using opposite Vanguard Growth and ClearBridge Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Growth position performs unexpectedly, ClearBridge Large 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 ClearBridge Large will offset losses from the drop in ClearBridge Large's long position.| Vanguard Growth vs. Vanguard Value Index | Vanguard Growth vs. Vanguard Information Technology | Vanguard Growth vs. Vanguard Small Cap Growth | Vanguard Growth vs. Vanguard Dividend Appreciation |
| ClearBridge Large vs. Vanguard Russell 1000 | ClearBridge Large vs. Vanguard Russell 2000 | ClearBridge Large vs. Vanguard Mega Cap | ClearBridge Large vs. Vanguard Russell 1000 |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |