Correlation Between Vanguard Energy and Calvert Large

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

By analyzing existing cross correlation between Vanguard Energy Fund and Calvert Large Cap, you can compare the effects of market volatilities on Vanguard Energy and Calvert Large 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 Energy with a short position of Calvert Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Energy and Calvert Large.

Diversification Opportunities for Vanguard Energy and Calvert Large

0.7

Correlation Coefficient

Vanguard Energy  Calvert Large

Poor diversification

The 3 months correlation between Vanguard and Calvert is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Energy Fund and Calvert Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Large Cap and Vanguard Energy 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 Energy Fund are associated (or correlated) with Calvert Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Large Cap has no effect on the direction of Vanguard Energy i.e., Vanguard Energy and Calvert Large go up and down completely randomly.

Pair Corralation between Vanguard Energy and Calvert Large

Assuming the 90 days horizon Vanguard Energy Fund is expected to generate 0.78 times more return on investment than Calvert Large. However, Vanguard Energy Fund is 1.28 times less risky than Calvert Large. It trades about 0.18 of its potential returns per unit of risk. Calvert Large Cap is currently generating about 0.06 per unit of risk. If you would invest  4,873  in Vanguard Energy Fund on August 26, 2025 and sell it today you would earn a total of  329.00  from holding Vanguard Energy Fund or generate 6.75% return on investment over 90 days.

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

Vanguard Energy Fund  vs.  Calvert Large Cap

Vanguard Energy

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Energy 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, Vanguard Energy may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Calvert Large Cap

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Large Cap are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Calvert Large 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 Energy and Calvert Large

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

The idea behind Vanguard Energy Fund and Calvert Large Cap 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.