Correlation Between Growth Fund and Investar Holding
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Investar Holding at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Growth Fund and Investar Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Of and Investar Holding Corp, you can compare the effects of market volatilities on Growth Fund and Investar Holding and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Growth Fund with a short position of Investar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Investar Holding.
Diversification Opportunities for Growth Fund and Investar Holding
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Growth and Investar is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Investar Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investar Holding Corp and Growth Fund is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Growth Fund Of are associated (or correlated) with Investar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investar Holding Corp has no effect on the direction of Growth Fund i.e., Growth Fund and Investar Holding go up and down completely randomly.
Pair Corralation between Growth Fund and Investar Holding
Assuming the 90 days horizon Growth Fund Of is expected to generate 0.53 times more return on investment than Investar Holding. However, Growth Fund Of is 1.88 times less risky than Investar Holding. It trades about 0.24 of its potential returns per unit of risk. Investar Holding Corp is currently generating about -0.25 per unit of risk. If you would invest 7,457 in Growth Fund Of on November 3, 2024 and sell it today you would earn a total of 374.00 from holding Growth Fund Of or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Growth Fund Of vs. Investar Holding Corp
Performance |
| Timeline |
| Growth Fund |
| Investar Holding Corp |
Growth Fund and Investar Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Investar Holding
The main advantage of trading using opposite Growth Fund and Investar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Investar Holding can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Investar Holding will offset losses from the drop in Investar Holding's long position.| Growth Fund vs. Capital World Growth | Growth Fund vs. Europacific Growth Fund | Growth Fund vs. New Perspective Fund | Growth Fund vs. Investment Of America |
| Investar Holding vs. Magyar Bancorp | Investar Holding vs. Home Federal Bancorp | Investar Holding vs. Community West Bancshares | Investar Holding vs. First Northwest Bancorp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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