Correlation Between Vanguard Total and The Tocqueville

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

Diversification Opportunities for Vanguard Total and The Tocqueville

0.84

Correlation Coefficient

Vanguard Total  The Tocqueville

Very poor diversification

The 3 months correlation between Vanguard and THE is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Stock and The Tocqueville Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Tocqueville 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 The Tocqueville. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Tocqueville has no effect on the direction of Vanguard Total i.e., Vanguard Total and The Tocqueville go up and down completely randomly.

Pair Corralation between Vanguard Total and The Tocqueville

Assuming the 90 days horizon Vanguard Total is expected to generate 5.8 times less return on investment than The Tocqueville. But when comparing it to its historical volatility, Vanguard Total Stock is 1.17 times less risky than The Tocqueville. It trades about 0.07 of its potential returns per unit of risk. The Tocqueville Fund is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  5,282  in The Tocqueville Fund on July 18, 2025 and sell it today you would earn a total of  361.00  from holding The Tocqueville Fund or generate 6.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.65%
Values	Daily Returns

Vanguard Total Stock  vs.  The Tocqueville Fund

Vanguard Total Stock

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Total Stock are ranked lower than 11 (%) 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 November 2025.

The Tocqueville

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Tocqueville Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, The Tocqueville may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with Vanguard Total and The Tocqueville

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

The idea behind Vanguard Total Stock and The Tocqueville 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.