Correlation Between Growth Fund and Amg Renaissance
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Amg Renaissance 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 Amg Renaissance 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 Amg Renaissance Large, you can compare the effects of market volatilities on Growth Fund and Amg Renaissance 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 Amg Renaissance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Amg Renaissance.
Diversification Opportunities for Growth Fund and Amg Renaissance
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Growth and Amg is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Amg Renaissance Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Renaissance Large 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 Amg Renaissance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Renaissance Large has no effect on the direction of Growth Fund i.e., Growth Fund and Amg Renaissance go up and down completely randomly.
Pair Corralation between Growth Fund and Amg Renaissance
Assuming the 90 days horizon Growth Fund Of is expected to generate 0.86 times more return on investment than Amg Renaissance. However, Growth Fund Of is 1.17 times less risky than Amg Renaissance. It trades about 0.13 of its potential returns per unit of risk. Amg Renaissance Large is currently generating about 0.1 per unit of risk. If you would invest 5,955 in Growth Fund Of on August 24, 2024 and sell it today you would earn a total of 2,161 from holding Growth Fund Of or generate 36.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Fund Of vs. Amg Renaissance Large
Performance |
| Timeline |
| Growth Fund |
| Amg Renaissance Large |
Growth Fund and Amg Renaissance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Amg Renaissance
The main advantage of trading using opposite Growth Fund and Amg Renaissance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Amg Renaissance 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 Amg Renaissance will offset losses from the drop in Amg Renaissance's long position.| Growth Fund vs. HUMANA INC | Growth Fund vs. Aquagold International | Growth Fund vs. Barloworld Ltd ADR | Growth Fund vs. Morningstar Unconstrained Allocation |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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