Correlation Between Growth Fund and Innovator Capital
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Innovator Capital 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 Innovator Capital 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 Innovator Capital Management, you can compare the effects of market volatilities on Growth Fund and Innovator Capital 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 Innovator Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Innovator Capital.
Diversification Opportunities for Growth Fund and Innovator Capital
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Growth and Innovator is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Innovator Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator Capital 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 Innovator Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator Capital has no effect on the direction of Growth Fund i.e., Growth Fund and Innovator Capital go up and down completely randomly.
Pair Corralation between Growth Fund and Innovator Capital
Assuming the 90 days horizon Growth Fund Of is expected to generate 6.06 times more return on investment than Innovator Capital. However, Growth Fund is 6.06 times more volatile than Innovator Capital Management. It trades about 0.1 of its potential returns per unit of risk. Innovator Capital Management is currently generating about 0.16 per unit of risk. If you would invest 6,186 in Growth Fund Of on November 4, 2024 and sell it today you would earn a total of 1,645 from holding Growth Fund Of or generate 26.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 92.31% |
| Values | Daily Returns |
Growth Fund Of vs. Innovator Capital Management
Performance |
| Timeline |
| Growth Fund |
| Innovator Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Growth Fund and Innovator Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Innovator Capital
The main advantage of trading using opposite Growth Fund and Innovator Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Innovator Capital 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 Innovator Capital will offset losses from the drop in Innovator Capital'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 |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |