Correlation Between Alger Health and Touchstone Sands
Can any of the company-specific risk be diversified away by investing in both Alger Health and Touchstone Sands 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 Alger Health and Touchstone Sands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger Health Sciences and Touchstone Sands Capital, you can compare the effects of market volatilities on Alger Health and Touchstone Sands 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 Alger Health with a short position of Touchstone Sands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Health and Touchstone Sands.
Diversification Opportunities for Alger Health and Touchstone Sands
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alger and Touchstone is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Alger Health Sciences and Touchstone Sands Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Sands Capital and Alger Health 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 Alger Health Sciences are associated (or correlated) with Touchstone Sands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Sands Capital has no effect on the direction of Alger Health i.e., Alger Health and Touchstone Sands go up and down completely randomly.
Pair Corralation between Alger Health and Touchstone Sands
Assuming the 90 days horizon Alger Health Sciences is expected to under-perform the Touchstone Sands. In addition to that, Alger Health is 1.47 times more volatile than Touchstone Sands Capital. It trades about -0.32 of its total potential returns per unit of risk. Touchstone Sands Capital is currently generating about 0.18 per unit of volatility. If you would invest 1,452 in Touchstone Sands Capital on November 27, 2024 and sell it today you would earn a total of 46.00 from holding Touchstone Sands Capital or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger Health Sciences vs. Touchstone Sands Capital
Performance |
| Timeline |
| Alger Health Sciences |
| Touchstone Sands Capital |
Alger Health and Touchstone Sands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Health and Touchstone Sands
The main advantage of trading using opposite Alger Health and Touchstone Sands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Health position performs unexpectedly, Touchstone Sands 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 Touchstone Sands will offset losses from the drop in Touchstone Sands' long position.| Alger Health vs. Alger Midcap Growth | Alger Health vs. Alger Midcap Growth | Alger Health vs. Alger Mid Cap | Alger Health vs. Alger Small Cap |
| Touchstone Sands vs. Barings Emerging Markets | Touchstone Sands vs. Franklin Federal Limited Term | Touchstone Sands vs. Investec Emerging Markets | Touchstone Sands vs. Shelton Emerging Markets |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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