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

Elvis Picardo is a regular contributor to Investopedia and has 25+ years of experience as a portfolio manager with diverse capital markets experience. A negative correlation means that two variables ...

Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems. David Kindness is a Certified Public Accountant (CPA) and an expert ...