New World Correlations

RNEBX Fund  USD 78.62  0.11  0.14%   
The current 90-days correlation between New World Fund and Vanguard Emerging Markets is 0.85 (i.e., Very poor diversification). The correlation of New World is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

New World Correlation With Market

Poor diversification

The correlation between New World Fund and NYA is 0.78 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding New World Fund and NYA in the same portfolio, assuming nothing else is changed.
  
Check out Your Equity Center to better understand how to build diversified portfolios, which includes a position in New World Fund. Also, note that the market value of any mutual fund could be closely tied with the direction of predictive economic indicators such as signals in bureau of labor statistics.

Moving together with New Mutual Fund

  0.92AMECX Income FundPairCorr
  0.9AMFCX American MutualPairCorr
  0.91AMFFX American MutualPairCorr
  0.91RNCCX American Funds IncomePairCorr
  0.72FPPPX American Funds PresePairCorr
  0.86RNGFX New Economy FundPairCorr
  0.81AMPFX Amcap Fund ClassPairCorr
  0.93RNPAX New PerspectivePairCorr
  0.94RNPGX New PerspectivePairCorr
  0.91AMRMX American MutualPairCorr
  1.0RNWGX New World FundPairCorr
  0.94NPFCX New PerspectivePairCorr
  0.94NPFFX New PerspectivePairCorr
  0.94PGGFX American Funds GlobalPairCorr
  0.94ANWPX New PerspectivePairCorr
  0.88BALFX American BalancedPairCorr
  0.87BALCX American BalancedPairCorr
  0.96CWGIX Capital World GrowthPairCorr
  0.96CWGFX Capital World GrowthPairCorr
  0.96CWGCX Capital World GrowthPairCorr
  0.96CEUCX Europacific GrowthPairCorr
  0.97CEUAX Europacific GrowthPairCorr
  0.89WSHFX Washington MutualPairCorr
  0.96CWICX Capital World GrowthPairCorr
  0.96CWIAX Capital World GrowthPairCorr
  0.97CEUFX Europacific GrowthPairCorr
  0.96CEUEX Europacific GrowthPairCorr
  0.94TXIFX American Funds TaxPairCorr
  0.89FAATX American Funds 2010PairCorr
  0.94PGXFX American Funds GlobalPairCorr
  0.91FAETX American Funds 2030PairCorr
  0.88FAFGX American FundsPairCorr
  0.95CFIHX Capital Income BuilderPairCorr

Related Correlations Analysis

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.
High positive correlations   
VEIEXVEMAX
CIRAXMSTSX
KMXOREAF
MSTSXVEMAX
MSTSXVEIEX
SEICKMX
  
High negative correlations   
AMPLOREAF
OREAFVEIEX
OREAFVEMAX
KMXAMPL
SEICAMPL
KMXVEIEX

Risk-Adjusted Indicators

There is a big difference between New Mutual Fund performing well and New World Mutual Fund doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze New World's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.
Mean DeviationJensen AlphaSortino RatioTreynor RatioSemi DeviationExpected ShortfallPotential UpsideValue @RiskMaximum Drawdown
VEMAX  0.57  0.07  0.08  0.14  0.61 
 1.18 
 3.25 
VEIEX  0.57  0.07  0.08  0.14  0.61 
 1.17 
 3.24 
SCRYY  2.13 (0.12) 0.00 (0.10) 0.00 
 4.44 
 17.20 
MSTSX  0.56  0.02  0.02  0.05  0.75 
 1.03 
 3.76 
OREAF  0.30 (0.16) 0.00  2.19  0.00 
 0.00 
 10.00 
KNF  1.35 (0.10) 0.00 (0.04) 0.00 
 2.92 
 9.23 
AMPL  3.15  0.28  0.04  0.85  4.82 
 7.08 
 34.55 
KMX  1.67 (0.05)(0.01) 0.00  2.73 
 3.29 
 13.77 
CIRAX  0.41  0.03  0.04  0.07  0.46 
 0.86 
 2.64 
SEIC  0.74 (0.07) 0.00 (0.04) 0.00 
 1.35 
 4.74