Looking to diversify beyond VFIAX? The mutual funds below have the lowest correlation with VFIAX — they tend to move on their own, which can help reduce risk when the rest of your portfolio drops. The stock ideas table highlights individual companies that behave independently from VFIAX.
Best Diversifiers for VFIAX
55 mutual funds have low correlation with VFIAX (below 0.3), 8 of which are negatively correlated. The least correlated is Invesco Energy Fund (FSTEX) (Energy Equities) with a 1Y correlation of -0.06, down from 0.32 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| Invesco Energy Fund | -0.06 | 0.18 | 0.32 | 70 | Energy Equities | VFIAX vs FSTEX | |
| Vanguard Energy Index Fund Admiral Shares | -0.06 | 0.19 | 0.33 | 58 | Energy Equities | VFIAX vs VENAX | |
| PIMCO Commodity Real Return Strategy Fund | -0.03 | 0.10 | 0.17 | 75 | Commodities | VFIAX vs PCRIX | |
| Vanguard Short-Term Inflation-Protected Securities... | -0.03 | 0.08 | 0.14 | 94 | Inflation-Protected Bonds | VFIAX vs VTSPX | |
| Fidelity Select Energy Portfolio | -0.02 | 0.22 | 0.32 | 79 | Energy Equities | VFIAX vs FSENX |
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Low-Correlation Stock Ideas
If you're looking for individual stocks that move independently from VFIAX, these are worth exploring. The table shows U.S. companies ($1B+ market cap) with low correlation to VFIAX and solid risk/return profiles. The least correlated is Altria Group, Inc. (MO) (Consumer Defensive) with a 1Y correlation of -0.19, down from 0.13 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Altria Group, Inc. | -0.19 | 0.02 | 0.13 | 69 | Consumer Defensive | |
| Exxon Mobil Corporation | -0.16 | 0.06 | 0.22 | 85 | Energy | |
| Chevron Corporation | -0.13 | 0.10 | 0.25 | 83 | Energy | |
| Duke Energy Corporation | -0.12 | 0.00 | 0.12 | 53 | Utilities | |
| ConocoPhillips Company | -0.12 | 0.10 | 0.24 | 76 | Energy |
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