Correlation Between Income Growth and Grizzly Short
Can any of the company-specific risk be diversified away by investing in both Income Growth and Grizzly Short 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 Income Growth and Grizzly Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Income Growth Fund and Grizzly Short Fund, you can compare the effects of market volatilities on Income Growth and Grizzly Short 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 Income Growth with a short position of Grizzly Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Income Growth and Grizzly Short.
Diversification Opportunities for Income Growth and Grizzly Short
-0.97 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Income and Grizzly is -0.97. Overlapping area represents the amount of risk that can be diversified away by holding Income Growth Fund and Grizzly Short Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grizzly Short and Income Growth 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 Income Growth Fund are associated (or correlated) with Grizzly Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grizzly Short has no effect on the direction of Income Growth i.e., Income Growth and Grizzly Short go up and down completely randomly.
Pair Corralation between Income Growth and Grizzly Short
Assuming the 90 days horizon Income Growth Fund is expected to generate 0.78 times more return on investment than Grizzly Short. However, Income Growth Fund is 1.28 times less risky than Grizzly Short. It trades about 0.07 of its potential returns per unit of risk. Grizzly Short Fund is currently generating about -0.06 per unit of risk. If you would invest 3,067 in Income Growth Fund on September 2, 2024 and sell it today you would earn a total of 881.00 from holding Income Growth Fund or generate 28.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Income Growth Fund vs. Grizzly Short Fund
Performance |
| Timeline |
| Income Growth |
| Grizzly Short |
Income Growth and Grizzly Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Income Growth and Grizzly Short
The main advantage of trading using opposite Income Growth and Grizzly Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Income Growth position performs unexpectedly, Grizzly Short 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 Grizzly Short will offset losses from the drop in Grizzly Short's long position.| Income Growth vs. Ultra Fund I | Income Growth vs. Value Fund I | Income Growth vs. Equity Growth Fund | Income Growth vs. International Growth Fund |
| Grizzly Short vs. The Gamco Global | Grizzly Short vs. Columbia Vertible Securities | Grizzly Short vs. Putnam Convertible Incm Gwth | Grizzly Short vs. Allianzgi Convertible Income |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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