Correlation Between Vanguard Russell and FundX Aggressive

Can any of the company-specific risk be diversified away by investing in both Vanguard Russell and FundX Aggressive 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 Russell and FundX Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vanguard Russell 1000 and FundX Aggressive ETF, you can compare the effects of market volatilities on Vanguard Russell and FundX Aggressive 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 Russell with a short position of FundX Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Russell and FundX Aggressive.

Diversification Opportunities for Vanguard Russell and FundX Aggressive

0.94

Correlation Coefficient

Vanguard Russell  FundX Aggressive

Almost no diversification

The 3 months correlation between Vanguard and FundX is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Russell 1000 and FundX Aggressive ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FundX Aggressive ETF and Vanguard Russell 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 Russell 1000 are associated (or correlated) with FundX Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FundX Aggressive ETF has no effect on the direction of Vanguard Russell i.e., Vanguard Russell and FundX Aggressive go up and down completely randomly.

Pair Corralation between Vanguard Russell and FundX Aggressive

Given the investment horizon of 90 days Vanguard Russell 1000 is expected to generate 0.89 times more return on investment than FundX Aggressive. However, Vanguard Russell 1000 is 1.12 times less risky than FundX Aggressive. It trades about -0.1 of its potential returns per unit of risk. FundX Aggressive ETF is currently generating about -0.1 per unit of risk. If you would invest  10,406  in Vanguard Russell 1000 on December 29, 2024 and sell it today you would lose (881.00) from holding Vanguard Russell 1000 or give up 8.47% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.39%
Values	Daily Returns

Vanguard Russell 1000  vs.  FundX Aggressive ETF

Vanguard Russell 1000

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vanguard Russell 1000 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest abnormal performance, the Etf's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the Exchange Traded Fund stockholders.

FundX Aggressive ETF

Risk-Adjusted Performance

Very Weak

Over the last 90 days FundX Aggressive ETF has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Etf's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the fund sophisticated investors.

Pair Trading with Vanguard Russell and FundX Aggressive

The main advantage of trading using opposite Vanguard Russell and FundX Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Russell position performs unexpectedly, FundX Aggressive 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 FundX Aggressive will offset losses from the drop in FundX Aggressive's long position.

The idea behind Vanguard Russell 1000 and FundX Aggressive ETF pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.