Correlation Between Ameritrans Capital and Bancroft Fund
Can any of the company-specific risk be diversified away by investing in both Ameritrans Capital and Bancroft 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 Ameritrans Capital and Bancroft Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameritrans Capital Corp and Bancroft Fund Limited, you can compare the effects of market volatilities on Ameritrans Capital and Bancroft 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 Ameritrans Capital with a short position of Bancroft Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameritrans Capital and Bancroft Fund.
Diversification Opportunities for Ameritrans Capital and Bancroft Fund
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameritrans and Bancroft is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ameritrans Capital Corp and Bancroft Fund Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bancroft Fund Limited and Ameritrans Capital 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 Ameritrans Capital Corp are associated (or correlated) with Bancroft Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bancroft Fund Limited has no effect on the direction of Ameritrans Capital i.e., Ameritrans Capital and Bancroft Fund go up and down completely randomly.
Pair Corralation between Ameritrans Capital and Bancroft Fund
Assuming the 90 days horizon Ameritrans Capital Corp is expected to under-perform the Bancroft Fund. In addition to that, Ameritrans Capital is 3.26 times more volatile than Bancroft Fund Limited. It trades about -0.04 of its total potential returns per unit of risk. Bancroft Fund Limited is currently generating about 0.03 per unit of volatility. If you would invest 1,556 in Bancroft Fund Limited on October 21, 2024 and sell it today you would earn a total of 260.00 from holding Bancroft Fund Limited or generate 16.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Ameritrans Capital Corp vs. Bancroft Fund Limited
Performance |
| Timeline |
| Ameritrans Capital Corp |
| Bancroft Fund Limited |
Ameritrans Capital and Bancroft Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameritrans Capital and Bancroft Fund
The main advantage of trading using opposite Ameritrans Capital and Bancroft Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameritrans Capital position performs unexpectedly, Bancroft 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 Bancroft Fund will offset losses from the drop in Bancroft Fund's long position.| Ameritrans Capital vs. NioCorp Developments Ltd | Ameritrans Capital vs. SLR Investment Corp | Ameritrans Capital vs. Summit Materials | Ameritrans Capital vs. Yuexiu Transport Infrastructure |
| Bancroft Fund vs. GAMCO Natural Resources | Bancroft Fund vs. RiverNorth Flexible Municipalome | Bancroft Fund vs. Brandywineglobal Globalome Opportunities | Bancroft Fund vs. Ameritrans Capital Corp |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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