Correlation Between Vanguard Inflation-protec and Strategic Asset

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

By analyzing existing cross correlation between Vanguard Inflation Protected Securities and Strategic Asset Management, you can compare the effects of market volatilities on Vanguard Inflation-protec and Strategic Asset 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 Inflation-protec with a short position of Strategic Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Inflation-protec and Strategic Asset.

Diversification Opportunities for Vanguard Inflation-protec and Strategic Asset

0.92

Correlation Coefficient

Vanguard Inflation-protec  Strategic Asset

Almost no diversification

The 3 months correlation between Vanguard and Strategic is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Inflation Protected S and Strategic Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Asset Mana and Vanguard Inflation-protec 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 Inflation Protected Securities are associated (or correlated) with Strategic Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Asset Mana has no effect on the direction of Vanguard Inflation-protec i.e., Vanguard Inflation-protec and Strategic Asset go up and down completely randomly.

Pair Corralation between Vanguard Inflation-protec and Strategic Asset

Assuming the 90 days horizon Vanguard Inflation-protec is expected to generate 1.73 times less return on investment than Strategic Asset. But when comparing it to its historical volatility, Vanguard Inflation Protected Securities is 1.25 times less risky than Strategic Asset. It trades about 0.16 of its potential returns per unit of risk. Strategic Asset Management is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  1,238  in Strategic Asset Management on May 15, 2025 and sell it today you would earn a total of  52.00  from holding Strategic Asset Management or generate 4.2% return on investment over 90 days.

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

Vanguard Inflation Protected S  vs.  Strategic Asset Management

Vanguard Inflation-protec

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Inflation Protected Securities are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Vanguard Inflation-protec is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Strategic Asset Mana

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Strategic Asset Management are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Strategic Asset is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vanguard Inflation-protec and Strategic Asset

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

The idea behind Vanguard Inflation Protected Securities and Strategic Asset Management 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..