Correlation Between Growth Fund and Nicholas Fund
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Nicholas Fund 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 Nicholas Fund 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 Nicholas Fund Inc, you can compare the effects of market volatilities on Growth Fund and Nicholas Fund 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 Nicholas Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Nicholas Fund.
Diversification Opportunities for Growth Fund and Nicholas Fund
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Growth and Nicholas is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Nicholas Fund Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicholas Fund 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 Nicholas Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicholas Fund has no effect on the direction of Growth Fund i.e., Growth Fund and Nicholas Fund go up and down completely randomly.
Pair Corralation between Growth Fund and Nicholas Fund
Assuming the 90 days horizon Growth Fund Of is expected to generate 1.19 times more return on investment than Nicholas Fund. However, Growth Fund is 1.19 times more volatile than Nicholas Fund Inc. It trades about 0.12 of its potential returns per unit of risk. Nicholas Fund Inc is currently generating about 0.09 per unit of risk. If you would invest 7,081 in Growth Fund Of on September 1, 2024 and sell it today you would earn a total of 1,169 from holding Growth Fund Of or generate 16.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Growth Fund Of vs. Nicholas Fund Inc
Performance |
| Timeline |
| Growth Fund |
| Nicholas Fund |
Growth Fund and Nicholas Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Nicholas Fund
The main advantage of trading using opposite Growth Fund and Nicholas Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Nicholas Fund 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 Nicholas Fund will offset losses from the drop in Nicholas Fund'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 |
| Nicholas Fund vs. Nicholas Equity Income | Nicholas Fund vs. Nicholas Ltd Edition | Nicholas Fund vs. Nicholas Ii Inc | Nicholas Fund vs. Mobile Telecommunications Ultrasector |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |