Emerging Markets Correlations

Mutual Funds USA . 
Fund . Emerging Markets Fund
GBFAX Fund  USD 13.79  0.13  0.93%   
The current 90-days correlation between Emerging Markets and Global Hard Assets is 0.72 (i.e., Poor diversification). The correlation of Emerging Markets 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.

Emerging Markets Correlation With Market

Weak diversification

The correlation between Emerging Markets Fund and DJI is 0.39 (i.e., Weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets 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 Emerging Markets 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 nation.

Moving together with Emerging Mutual Fund

  0.8EMBAX Unconstrained EmergingPairCorr
  0.8EMBYX Unconstrained EmergingPairCorr
  0.81EMBUX Unconstrained EmergingPairCorr
  1.0EMRIX Emerging MarketsPairCorr
  1.0EMRCX Emerging MarketsPairCorr
  1.0EMRZX Vaneck Emerging MarketsPairCorr
  1.0EMRYX Emerging MarketsPairCorr
  0.62GHAIX Global Hard AssetsPairCorr
  0.62GHAYX Global Hard AssetsPairCorr
  0.62GHAAX Global Hard AssetsPairCorr
  0.64GHACX Global Hard AssetsPairCorr
  0.63CMCAX Cm Modity IndexPairCorr
  0.62CMCYX Cm Modity IndexPairCorr
  0.62COMIX Cm Modity IndexPairCorr
  0.78VEMAX Vanguard Emerging MarketsPairCorr
  0.78VEIEX Vanguard Emerging MarketsPairCorr
  0.77VEMIX Vanguard Emerging MarketsPairCorr
  0.77VEMRX Vanguard Emerging MarketsPairCorr
  0.92FWWNX American Funds NewPairCorr
  0.92FNFWX American Funds NewPairCorr
  0.92NEWFX New World FundPairCorr
  0.92NWFFX New World FundPairCorr
  0.93NEWCX New World FundPairCorr
  0.95ODVYX Oppenheimer DevelopingPairCorr
  0.77GAAKX Gmo Alternative AlloPairCorr
  0.76GAAGX Gmo Alternative AlloPairCorr

Moving against Emerging Mutual Fund

  0.35PQTNX Pimco Trends ManagedPairCorr
  0.35PQTIX Aa Pimco TrPairCorr
  0.34PQTAX Pimco Trends ManagedPairCorr

Related Correlations Analysis

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Risk-Adjusted Indicators

There is a big difference between Emerging Mutual Fund performing well and Emerging Markets 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 Emerging Markets' 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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