Correlation coefficients range from -1 to +1, indicating the strength of relationships between variables. Investors use correlation coefficients for portfolio diversification to reduce risk.

James Chen, CMT is an expert trader, investment adviser, and global market strategist. Thomas J. Brock is a CFA and CPA with more than 20 years of experience in various areas including investing, ...

Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor. Claire's expertise lies in corporate finance & accounting, mutual funds, ...

Investments with low correlations to the S&P 500 can provide diversification benefits. These investments often represent different asset classes as opposed to individual stocks. A basket of low ...