Looking to diversify beyond VTMSX? The mutual funds below have the lowest correlation with VTMSX — 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 VTMSX.
Best Diversifiers for VTMSX
8 mutual funds have low correlation with VTMSX (below 0.3), 0 of which are negatively correlated. The least correlated is BlackRock Short-Term Municipal Fund (MALMX) (Municipal Bonds) with a 1Y correlation of 0.14, roughly unchanged from 0.09 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Category | Compare |
|---|---|---|---|---|---|---|---|
| BlackRock Short-Term Municipal Fund | 0.14 | 0.14 | 0.09 | 72 | Municipal Bonds | VTMSX vs MALMX | |
| Vanguard Limited-Term Tax-Exempt Fund Investor Sha... | 0.15 | 0.12 | 0.09 | 75 | Municipal Bonds | VTMSX vs VMLTX | |
| Vanguard Intermediate-Term Tax-Exempt Fund Admiral... | 0.18 | 0.14 | 0.10 | 72 | Municipal Bonds | VTMSX vs VWIUX | |
| BlackRock MuniYield Michigan Quality Fund | 0.21 | 0.26 | 0.25 | 59 | Municipal Bonds | VTMSX vs MIY | |
| Vanguard Short-Term Treasury Fund Admiral Shares | 0.25 | 0.13 | 0.08 | 63 | Government Bonds | VTMSX vs VFIRX |
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Low-Correlation Stock Ideas
If you're looking for individual stocks that move independently from VTMSX, these are worth exploring. The table shows U.S. companies ($1B+ market cap) with low correlation to VTMSX and solid risk/return profiles. The least correlated is Berkshire Hathaway Inc. (BRK-B) (Financial Services) with a 1Y correlation of 0.22, down from 0.53 over 5 years.
| Symbol | Name | Correlation 1Y | Correlation 3Y | Correlation 5Y | Risk / Return Rank | Sector |
|---|---|---|---|---|---|---|
| Berkshire Hathaway Inc. | 0.22 | 0.40 | 0.53 | 53 | Financial Services |
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