Correlation Analysis - Calculates the correlation coefficients between each pair of assets within a set of mutual funds, ETFs or stocks.  Asset prices are analyzed over a historical period of your choosing.  This tool does not suggest any optimal asset weightings like the Efficient Frontier or Sharpe Allocator.  However, it is a very powerful tool that allows you to examine performance relationships between assets in your portfolio.  The key to effective portfolio diversification is to select assets that do not move in tandem with each other.  So be on the lookout for a portfolio that has too many strong correlation coefficients ranging from 0.7 - 1.0.  The best diversified portfolios will have good performing assets that deliver solid returns, but that have weaker or even negative correlations with respect to each other.  Remember, these correlations are based on historical data, and correlations can change in the future. 

Build your portfolio of assets below before selecting the Next Step button.