Correlation Between Vanguard Total and Ellsworth Fund

Can any of the company-specific risk be diversified away by investing in both Vanguard Total and Ellsworth Fund 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 Ellsworth Fund 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 Ellsworth Fund, you can compare the effects of market volatilities on Vanguard Total and Ellsworth Fund 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 Ellsworth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Ellsworth Fund.

Diversification Opportunities for Vanguard Total and Ellsworth Fund

0.97

Correlation Coefficient

Vanguard Total  Ellsworth Fund

Almost no diversification

The 3 months correlation between Vanguard and Ellsworth is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and Ellsworth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ellsworth Fund 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 Ellsworth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ellsworth Fund has no effect on the direction of Vanguard Total i.e., Vanguard Total and Ellsworth Fund go up and down completely randomly.

Pair Corralation between Vanguard Total and Ellsworth Fund

Assuming the 90 days horizon Vanguard Total is expected to generate 1.07 times less return on investment than Ellsworth Fund. In addition to that, Vanguard Total is 1.07 times more volatile than Ellsworth Fund. It trades about 0.21 of its total potential returns per unit of risk. Ellsworth Fund is currently generating about 0.25 per unit of volatility. If you would invest  1,060  in Ellsworth Fund on May 5, 2025 and sell it today you would earn a total of  122.00  from holding Ellsworth Fund or generate 11.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Vanguard Total Stock  vs.  Ellsworth Fund

Vanguard Total Stock

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Total Stock are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Vanguard Total may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Ellsworth Fund

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ellsworth Fund are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Ellsworth Fund may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Vanguard Total and Ellsworth Fund

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

The idea behind Vanguard Total Stock and Ellsworth Fund 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.