Looking to balance out your exposure to DD? The ETFs below have historically moved differently from DD, which may reduce portfolio volatility when combined in a suitable allocation. The stock ideas table highlights individual companies with the same low-correlation characteristics. Correlation can change and does not guarantee that one asset will rise when another falls.
Best Diversifiers for DD
1 ETFs have low correlation with DD (below 0.3), 0 of which are negatively correlated. The least correlated is State Street Health Care Select Sector SPDR ETF (XLV) (Health & Biotech Equities) with a 1Y correlation of 0.25, down from 0.40 over 5 years.
How candidates are selected| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| State Street Health Care Select Sector SPDR ETF | 0.25 | 0.36 | 0.40 | 68 | Health & Biotech Equities | DD vs XLV | |
| Xtrackers MSCI EAFE High Dividend Yield Equity ETF | 0.40 | 0.45 | 0.55 | 79 | Foreign Large Cap Equities, Dividend | DD vs HDEF | |
| Vanguard S&P 500 Growth ETF | 0.40 | 0.41 | 0.51 | 53 | S&P 500, Large Cap Growth Equities | DD vs VOOG | |
| Freedom 100 Emerging Markets ETF | 0.46 | 0.47 | 0.53 | 85 | Emerging Markets Equities | DD vs FRDM | |
| Vanguard S&P 500 ETF | 0.52 | 0.55 | 0.62 | 78 | S&P 500 | DD vs VOO |
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Low-Correlation Stock Ideas
The table shows companies with at least $1B in market capitalization, historical correlation data for DD, and a Risk / Return Rank of 50 or higher. Treat them as research candidates rather than evidence that they will offset a future decline. The least correlated is Consolidated Edison, Inc. (ED) (Utilities) with a 1Y correlation of -0.12, down from 0.12 over 5 years.
How candidates are selected| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Consolidated Edison, Inc. | -0.12 | 0.03 | 0.12 | 56 | Utilities | |
| Cboe Global Markets, Inc. | -0.09 | -0.11 | 0.06 | 62 | Financial Services | |
| The Coca-Cola Company | -0.05 | 0.11 | 0.20 | 87 | Consumer Defensive | |
| Exxon Mobil Corporation | -0.04 | 0.18 | 0.29 | 85 | Energy | |
| Apache Corporation | -0.04 | 0.20 | 0.33 | 91 | Energy |
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