Correlation Between American Funds and Shenwu Energy
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By analyzing existing cross correlation between American Funds Fundamental and Shenwu Energy Saving, you can compare the effects of market volatilities on American Funds and Shenwu Energy 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 Funds with a short position of Shenwu Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Shenwu Energy.
Diversification Opportunities for American Funds and Shenwu Energy
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between American and Shenwu is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Fundamental and Shenwu Energy Saving in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenwu Energy Saving and American Funds 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 Funds Fundamental are associated (or correlated) with Shenwu Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenwu Energy Saving has no effect on the direction of American Funds i.e., American Funds and Shenwu Energy go up and down completely randomly.
Pair Corralation between American Funds and Shenwu Energy
Assuming the 90 days horizon American Funds Fundamental is expected to under-perform the Shenwu Energy. But the mutual fund apears to be less risky and, when comparing its historical volatility, American Funds Fundamental is 3.03 times less risky than Shenwu Energy. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Shenwu Energy Saving is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 346.00 in Shenwu Energy Saving on October 24, 2024 and sell it today you would earn a total of 53.00 from holding Shenwu Energy Saving or generate 15.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 93.65% |
| Values | Daily Returns |
American Funds Fundamental vs. Shenwu Energy Saving
Performance |
| Timeline |
| American Funds Funda |
| Shenwu Energy Saving |
American Funds and Shenwu Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Shenwu Energy
The main advantage of trading using opposite American Funds and Shenwu Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Shenwu Energy 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 Shenwu Energy will offset losses from the drop in Shenwu Energy's long position.| American Funds vs. Virtus High Yield | American Funds vs. Ab High Income | American Funds vs. Multi Manager High Yield | American Funds vs. Ab High Income |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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