American Funds Correlations

Mutual Funds . USA . 
Fund . American Funds 2020
RCCTX Fund  USD 14.21  0.05  0.35%   
The current 90-days correlation between American Funds 2020 and American Funds 2025 is 0.99 (i.e., No risk reduction). The correlation of American Funds 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.

American Funds Correlation With Market

Poor diversification

The correlation between American Funds 2020 and DJI is 0.74 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding American Funds 2020 and DJI 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 American Funds 2020. 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 estimate.

Moving together with American Mutual Fund

  0.78AMECX Income FundPairCorr
  0.65RNEBX New World FundPairCorr
  0.63AMFCX American MutualPairCorr
  0.62AMFFX American MutualPairCorr
  0.98RNCCX American Funds IncomePairCorr
  0.77AMEFX Income FundPairCorr
  0.86FPTPX American Funds ConsePairCorr
  0.64CDJAX American Funds CollegePairCorr
  0.8RNPBX New PerspectivePairCorr
  0.8RNPAX New PerspectivePairCorr
  0.79RNPHX New PerspectivePairCorr
  0.79RNPGX New PerspectivePairCorr
  0.8RNPCX New PerspectivePairCorr
  0.79RNPFX New PerspectivePairCorr
  0.79RNPEX New PerspectivePairCorr
  0.71AMRMX American MutualPairCorr
  0.61AMRFX American MutualPairCorr
  0.89RNRPX American Funds RetirementPairCorr
  0.66RNWFX New World FundPairCorr

Related Correlations Analysis

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Risk-Adjusted Indicators

There is a big difference between American Mutual Fund performing well and American Funds 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 American Funds' 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.

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