Looking to diversify beyond VSMSX? The mutual funds below have historically moved differently from VSMSX, 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 VSMSX
1 mutual funds have low correlation with VSMSX (below 0.3), 0 of which are negatively correlated. The least correlated is Vanguard Limited-Term Tax-Exempt Fund Investor Shares (VMLTX) (Municipal Bonds) with a 1Y correlation of 0.19, roughly unchanged from 0.10 over 5 years.
How candidates are selected| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| Vanguard Limited-Term Tax-Exempt Fund Investor Sha... | 0.19 | 0.12 | 0.10 | 56 | Municipal Bonds | VSMSX vs VMLTX | |
| Vanguard Total International Stock Index Fund Admi... | 0.68 | 0.69 | 0.71 | 72 | Foreign Large Cap Equities | VSMSX vs VTIAX | |
| Vanguard Wellington Fund Investor Shares | 0.71 | 0.72 | 0.76 | 64 | Diversified Portfolio | VSMSX vs VWELX | |
| Auer Growth Fund | 0.71 | 0.76 | 0.81 | 93 | Small Cap Blend Equities | VSMSX vs AUERX | |
| Hennessy Cornerstone Growth Fund | 0.71 | 0.80 | 0.81 | 51 | Small Cap Blend Equities | VSMSX vs HFCGX |
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