Correlation Between Vanguard Total and Doubleline Total

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

By analyzing existing cross correlation between Vanguard Total Stock and Doubleline Total Return, you can compare the effects of market volatilities on Vanguard Total and Doubleline Total 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 Total with a short position of Doubleline Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Doubleline Total.

Diversification Opportunities for Vanguard Total and Doubleline Total

-0.64

Correlation Coefficient

Vanguard Total  Doubleline Total

Excellent diversification

The 3 months correlation between Vanguard and Doubleline is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and Doubleline Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Total Return and Vanguard Total 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 Total Stock are associated (or correlated) with Doubleline Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Total Return has no effect on the direction of Vanguard Total i.e., Vanguard Total and Doubleline Total go up and down completely randomly.

Pair Corralation between Vanguard Total and Doubleline Total

Assuming the 90 days horizon Vanguard Total Stock is expected to under-perform the Doubleline Total. In addition to that, Vanguard Total is 5.79 times more volatile than Doubleline Total Return. It trades about -0.08 of its total potential returns per unit of risk. Doubleline Total Return is currently generating about 0.11 per unit of volatility. If you would invest  857.00  in Doubleline Total Return on January 16, 2025 and sell it today you would earn a total of  19.00  from holding Doubleline Total Return or generate 2.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Vanguard Total Stock  vs.  Doubleline Total Return

Vanguard Total Stock

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vanguard Total Stock has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Doubleline Total Return

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Total Return are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Doubleline Total 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 Total and Doubleline Total

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

The idea behind Vanguard Total Stock and Doubleline Total Return 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.