Correlation Between Ancora Microcap and Fs Multi-strategy
Can any of the company-specific risk be diversified away by investing in both Ancora Microcap and Fs Multi-strategy 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 Ancora Microcap and Fs Multi-strategy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ancora Microcap Fund and Fs Multi Strategy Alt, you can compare the effects of market volatilities on Ancora Microcap and Fs Multi-strategy 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 Ancora Microcap with a short position of Fs Multi-strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ancora Microcap and Fs Multi-strategy.
Diversification Opportunities for Ancora Microcap and Fs Multi-strategy
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ancora and FSMMX is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Ancora Microcap Fund and Fs Multi Strategy Alt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fs Multi Strategy and Ancora Microcap 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 Ancora Microcap Fund are associated (or correlated) with Fs Multi-strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fs Multi Strategy has no effect on the direction of Ancora Microcap i.e., Ancora Microcap and Fs Multi-strategy go up and down completely randomly.
Pair Corralation between Ancora Microcap and Fs Multi-strategy
Assuming the 90 days horizon Ancora Microcap Fund is expected to generate 6.59 times more return on investment than Fs Multi-strategy. However, Ancora Microcap is 6.59 times more volatile than Fs Multi Strategy Alt. It trades about 0.06 of its potential returns per unit of risk. Fs Multi Strategy Alt is currently generating about 0.11 per unit of risk. If you would invest 1,377 in Ancora Microcap Fund on September 3, 2024 and sell it today you would earn a total of 410.00 from holding Ancora Microcap Fund or generate 29.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ancora Microcap Fund vs. Fs Multi Strategy Alt
Performance |
| Timeline |
| Ancora Microcap |
| Fs Multi Strategy |
Ancora Microcap and Fs Multi-strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ancora Microcap and Fs Multi-strategy
The main advantage of trading using opposite Ancora Microcap and Fs Multi-strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ancora Microcap position performs unexpectedly, Fs Multi-strategy 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 Fs Multi-strategy will offset losses from the drop in Fs Multi-strategy's long position.| Ancora Microcap vs. Virtus Real Estate | Ancora Microcap vs. Simt Real Estate | Ancora Microcap vs. Dunham Real Estate | Ancora Microcap vs. Jhancock Real Estate |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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