Correlation Between American Mutual and Archer Balanced
Can any of the company-specific risk be diversified away by investing in both American Mutual and Archer Balanced 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 American Mutual and Archer Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Mutual Fund and Archer Balanced Fund, you can compare the effects of market volatilities on American Mutual and Archer Balanced 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 American Mutual with a short position of Archer Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Mutual and Archer Balanced.
Diversification Opportunities for American Mutual and Archer Balanced
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Archer is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding American Mutual Fund and Archer Balanced Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Archer Balanced and American Mutual 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 American Mutual Fund are associated (or correlated) with Archer Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Archer Balanced has no effect on the direction of American Mutual i.e., American Mutual and Archer Balanced go up and down completely randomly.
Pair Corralation between American Mutual and Archer Balanced
Assuming the 90 days horizon American Mutual Fund is expected to generate 1.16 times more return on investment than Archer Balanced. However, American Mutual is 1.16 times more volatile than Archer Balanced Fund. It trades about 0.11 of its potential returns per unit of risk. Archer Balanced Fund is currently generating about 0.11 per unit of risk. If you would invest 4,717 in American Mutual Fund on August 31, 2024 and sell it today you would earn a total of 1,205 from holding American Mutual Fund or generate 25.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Mutual Fund vs. Archer Balanced Fund
Performance |
| Timeline |
| American Mutual |
| Archer Balanced |
American Mutual and Archer Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Mutual and Archer Balanced
The main advantage of trading using opposite American Mutual and Archer Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Mutual position performs unexpectedly, Archer Balanced 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 Archer Balanced will offset losses from the drop in Archer Balanced's long position.| American Mutual vs. Harbor Vertible Securities | American Mutual vs. Virtus Convertible | American Mutual vs. Fidelity Sai Convertible | American Mutual vs. Lord Abbett Convertible |
| Archer Balanced vs. Dreyfusstandish Global Fixed | Archer Balanced vs. Calamos Dynamic Convertible | Archer Balanced vs. Thrivent Income Fund | Archer Balanced vs. Versatile Bond Portfolio |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Stocks Directory Find actively traded stocks across global markets |