Correlation Between Growth Fund and SPAR
Can any of the company-specific risk be diversified away by investing in both Growth Fund and SPAR 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 SPAR 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 SPAR Group, you can compare the effects of market volatilities on Growth Fund and SPAR 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 SPAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and SPAR.
Diversification Opportunities for Growth Fund and SPAR
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Growth and SPAR is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and SPAR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPAR Group 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 SPAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPAR Group has no effect on the direction of Growth Fund i.e., Growth Fund and SPAR go up and down completely randomly.
Pair Corralation between Growth Fund and SPAR
Assuming the 90 days horizon Growth Fund Of is expected to generate 0.49 times more return on investment than SPAR. However, Growth Fund Of is 2.02 times less risky than SPAR. It trades about 0.24 of its potential returns per unit of risk. SPAR Group is currently generating about 0.06 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 Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Fund Of vs. SPAR Group
Performance |
| Timeline |
| Growth Fund |
| SPAR Group |
Growth Fund and SPAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and SPAR
The main advantage of trading using opposite Growth Fund and SPAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, SPAR 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 SPAR will offset losses from the drop in SPAR'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 |
| SPAR vs. Mitie Group Plc | SPAR vs. Dexterra Group | SPAR vs. Wildpack Beverage | SPAR vs. Intertek Group Plc |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |