Correlation Between Vanguard Growth and Novo Resources

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

By analyzing existing cross correlation between Vanguard Growth Index and Novo Resources Corp, you can compare the effects of market volatilities on Vanguard Growth and Novo Resources 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 Growth with a short position of Novo Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Growth and Novo Resources.

Diversification Opportunities for Vanguard Growth and Novo Resources

0.09

Correlation Coefficient

Vanguard Growth  Novo Resources

Significant diversification

The 3 months correlation between VANGUARD and Novo is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Growth Index and Novo Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novo Resources Corp and Vanguard Growth 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 Growth Index are associated (or correlated) with Novo Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novo Resources Corp has no effect on the direction of Vanguard Growth i.e., Vanguard Growth and Novo Resources go up and down completely randomly.

Pair Corralation between Vanguard Growth and Novo Resources

Assuming the 90 days horizon Vanguard Growth Index is expected to generate 0.24 times more return on investment than Novo Resources. However, Vanguard Growth Index is 4.17 times less risky than Novo Resources. It trades about 0.07 of its potential returns per unit of risk. Novo Resources Corp is currently generating about 0.0 per unit of risk. If you would invest  14,428  in Vanguard Growth Index on March 25, 2025 and sell it today you would earn a total of  7,062  from holding Vanguard Growth Index or generate 48.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Vanguard Growth Index  vs.  Novo Resources Corp

Vanguard Growth Index

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Growth Index are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Vanguard Growth may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Novo Resources Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Novo Resources Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Novo Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vanguard Growth and Novo Resources

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

The idea behind Vanguard Growth Index and Novo Resources Corp 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.