Correlation Between Aama Income and Aama Equity
Can any of the company-specific risk be diversified away by investing in both Aama Income and Aama Equity 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 Aama Income and Aama Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aama Income Fund and Aama Equity Fund, you can compare the effects of market volatilities on Aama Income and Aama Equity 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 Aama Income with a short position of Aama Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aama Income and Aama Equity.
Diversification Opportunities for Aama Income and Aama Equity
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aama and Aama is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Aama Income Fund and Aama Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aama Equity Fund and Aama Income 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 Aama Income Fund are associated (or correlated) with Aama Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aama Equity Fund has no effect on the direction of Aama Income i.e., Aama Income and Aama Equity go up and down completely randomly.
Pair Corralation between Aama Income and Aama Equity
Assuming the 90 days horizon Aama Income Fund is expected to generate 0.09 times more return on investment than Aama Equity. However, Aama Income Fund is 11.18 times less risky than Aama Equity. It trades about 0.4 of its potential returns per unit of risk. Aama Equity Fund is currently generating about 0.01 per unit of risk. If you would invest 2,392 in Aama Income Fund on November 28, 2024 and sell it today you would earn a total of 10.00 from holding Aama Income Fund or generate 0.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aama Income Fund vs. Aama Equity Fund
Performance |
| Timeline |
| Aama Income Fund |
| Aama Equity Fund |
Aama Income and Aama Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aama Income and Aama Equity
The main advantage of trading using opposite Aama Income and Aama Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aama Income position performs unexpectedly, Aama Equity 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 Aama Equity will offset losses from the drop in Aama Equity's long position.| Aama Income vs. Intermediate Term Bond Fund | Aama Income vs. Flexible Bond Portfolio | Aama Income vs. Intermediate Bond Fund | Aama Income vs. Jhvit Core Bond |
| Aama Equity vs. World Energy Fund | Aama Equity vs. Blackrock All Cap Energy | Aama Equity vs. Invesco Energy Fund | Aama Equity vs. Thrivent Natural Resources |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |