Correlation Between American Mutual and Bond Fund
Can any of the company-specific risk be diversified away by investing in both American Mutual and Bond 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 American Mutual and Bond Fund 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 Bond Fund Of, you can compare the effects of market volatilities on American Mutual and Bond 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 American Mutual with a short position of Bond Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Mutual and Bond Fund.
Diversification Opportunities for American Mutual and Bond Fund
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and Bond is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding American Mutual Fund and Bond Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bond Fund 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 Bond Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bond Fund has no effect on the direction of American Mutual i.e., American Mutual and Bond Fund go up and down completely randomly.
Pair Corralation between American Mutual and Bond Fund
Assuming the 90 days horizon American Mutual Fund is expected to generate 1.77 times more return on investment than Bond Fund. However, American Mutual is 1.77 times more volatile than Bond Fund Of. It trades about 0.24 of its potential returns per unit of risk. Bond Fund Of is currently generating about 0.08 per unit of risk. If you would invest 5,821 in American Mutual Fund on September 1, 2024 and sell it today you would earn a total of 182.00 from holding American Mutual Fund or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
American Mutual Fund vs. Bond Fund Of
Performance |
| Timeline |
| American Mutual |
| Bond Fund |
American Mutual and Bond Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Mutual and Bond Fund
The main advantage of trading using opposite American Mutual and Bond Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Mutual position performs unexpectedly, Bond 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 Bond Fund will offset losses from the drop in Bond Fund's long position.| American Mutual vs. Amcap Fund Class | American Mutual vs. American Balanced Fund | American Mutual vs. New Perspective Fund | American Mutual vs. New World Fund |
| Bond Fund vs. American High Income | Bond Fund vs. Europacific Growth Fund | Bond Fund vs. Capital World Bond | Bond Fund vs. Growth Fund Of |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Stocks Directory Find actively traded stocks across global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |