Looking to diversify beyond VLCAX? The mutual funds below have the lowest correlation with VLCAX — 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 VLCAX.
Best Diversifiers for VLCAX
3 mutual funds have low correlation with VLCAX (below 0.3), 0 of which are negatively correlated. The least correlated is Vanguard Short-Term Inflation-Protected Securities Index Fund Admiral Shares (VTAPX) (Inflation-Protected Bonds) with a 1Y correlation of 0.04, down from 0.15 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| Vanguard Short-Term Inflation-Protected Securities... | 0.04 | 0.09 | 0.15 | 84 | Inflation-Protected Bonds | VLCAX vs VTAPX | |
| Vanguard Short-Term Treasury Index Fund Admiral Sh... | 0.24 | 0.08 | 0.08 | 82 | Government Bonds | VLCAX vs VSBSX | |
| Fidelity Floating Rate High Income Fund | 0.29 | 0.31 | 0.33 | 92 | Bank Loan | VLCAX vs FFRHX | |
| Goldman Sachs Strategic Volatility Premium Fund | 0.32 | 0.15 | 0.13 | 72 | Large Cap Blend Equities | VLCAX vs SVPFX | |
| AQR Long-Short Equity Fund | 0.46 | 0.45 | 0.32 | 57 | Long-Short | VLCAX vs QLEIX |
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Low-Correlation Stock Ideas
If you're looking for individual stocks that move independently from VLCAX, these are worth exploring. The table shows U.S. companies ($1B+ market cap) with low correlation to VLCAX and solid risk/return profiles. The least correlated is Altria Group, Inc. (MO) (Consumer Defensive) with a 1Y correlation of -0.20, down from 0.12 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Altria Group, Inc. | -0.20 | -0.01 | 0.12 | 72 | Consumer Defensive | |
| Exxon Mobil Corporation | -0.18 | 0.04 | 0.18 | 72 | Energy | |
| The Coca-Cola Company | -0.18 | 0.03 | 0.20 | 74 | Consumer Defensive | |
| Duke Energy Corporation | -0.15 | -0.01 | 0.10 | 62 | Utilities | |
| Chevron Corporation | -0.14 | 0.07 | 0.20 | 70 | Energy |
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Build a portfolio that complements VLCAX
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