Vanguard Explorer Correlations

VEVFX Fund

USD 40.68 0.91 2.29%

The current 90-days correlation between Vanguard Explorer Value and Vanguard Strategic Small Cap is 0.98 (i.e., Almost no diversification). The correlation of Vanguard Explorer 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.

Vanguard Explorer Correlation With Market

Very weak diversification

The correlation between Vanguard Explorer Value and DJI is 0.42 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Explorer Value and DJI in the same portfolio, assuming nothing else is changed.

Check out World Market Map to better understand how to build diversified portfolios, which includes a position in Vanguard Explorer Value. 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 census.

Moving together with Vanguard Mutual Fund

0.67	VMVAX	Vanguard Mid Cap	Pair Corr
0.89	VSCIX	Vanguard Small Cap	Pair Corr
0.88	VSEMX	Vanguard Extended Market	Pair Corr
0.88	VSGAX	Vanguard Small Cap	Pair Corr
0.89	VSIAX	Vanguard Small Cap	Pair Corr
0.89	VSMAX	Vanguard Small Cap	Pair Corr
0.79	VTMFX	Vanguard Tax Managed	Pair Corr
0.66	VWELX	Vanguard Wellington	Pair Corr
0.82	VFIAX	Vanguard 500 Index	Pair Corr

Moving against Vanguard Mutual Fund

0.64	VSGBX	Vanguard Short Term	Pair Corr
0.56	VBTLX	Vanguard Total Bond	Pair Corr
0.53	VTBIX	Vanguard Total Bond	Pair Corr
0.53	VTBNX	Vanguard Total Bond	Pair Corr
0.53	VBTIX	Vanguard Total Bond	Pair Corr
0.48	VMLUX	Vanguard Limited Term	Pair Corr
0.48	VMLTX	Vanguard Limited Term	Pair Corr
0.43	VTIAX	Vanguard Total Inter	Pair Corr
0.4	VMMSX	Vanguard Emerging Markets	Pair Corr
0.39	VBLIX	Vanguard Long Term	Pair Corr
0.32	VMNVX	Vanguard Global Minimum	Pair Corr
0.65	VUBFX	Vanguard Ultra-short-term	Pair Corr
0.59	VWSTX	Vanguard Short Term	Pair Corr
0.55	VFIJX	Vanguard Gnma	Pair Corr
0.45	VTSNX	Vanguard Total Inter	Pair Corr
0.43	VTPSX	Vanguard Total Inter	Pair Corr
0.31	VEMIX	Vanguard Emerging Markets	Pair Corr

Related Correlations Analysis

	VSTCX	VMMSX	VDEQX	VMGRX	VASVX
VSTCX		-0.47	0.92	0.9	0.87	VSTCX
VMMSX	-0.47		-0.38	-0.4	-0.16	VMMSX
VDEQX	0.92	-0.38		0.94	0.71	VDEQX
VMGRX	0.9	-0.4	0.94		0.65	VMGRX
VASVX	0.87	-0.16	0.71	0.65		VASVX
	VSTCX	VMMSX	VDEQX	VMGRX	VASVX

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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

VMGRX	+ 0.94	VDEQX
VDEQX	+ 0.92	VSTCX
VMGRX	+ 0.9	VSTCX
VASVX	+ 0.87	VSTCX
VASVX	+ 0.71	VDEQX
VASVX	+ 0.65	VMGRX

High negative correlations

VMMSX	- 0.47	VSTCX
VMGRX	- 0.4	VMMSX
VDEQX	- 0.38	VMMSX
VASVX	- 0.16	VMMSX

Risk-Adjusted Indicators

There is a big difference between Vanguard Mutual Fund performing well and Vanguard Explorer 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 Vanguard Explorer'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.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
VSTCX	1.13	(0.24)	0.00	(0.26)	0.00	0.00	1.65	(2.59)	11.79
VMMSX	0.76	0.08	0.11	0.15	0.85	(0.88)	1.61	(1.60)	5.75
VDEQX	0.92	(0.11)	0.00	(0.14)	0.00	0.00	1.38	(2.27)	5.29
VMGRX	1.19	(0.11)	0.00	(0.13)	0.00	0.00	1.86	(3.32)	6.20
VASVX	0.93	(0.20)	0.00	(0.28)	0.00	0.00	1.40	(1.75)	14.06

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