Correlation Between Arbitrage Fund and Hussman Strategic
Can any of the company-specific risk be diversified away by investing in both Arbitrage Fund and Hussman Strategic 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 Arbitrage Fund and Hussman Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Arbitrage Fund and Hussman Strategic Growth, you can compare the effects of market volatilities on Arbitrage Fund and Hussman Strategic 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 Arbitrage Fund with a short position of Hussman Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arbitrage Fund and Hussman Strategic.
Diversification Opportunities for Arbitrage Fund and Hussman Strategic
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Arbitrage and Hussman is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding The Arbitrage Fund and Hussman Strategic Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hussman Strategic Growth and Arbitrage Fund 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 The Arbitrage Fund are associated (or correlated) with Hussman Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hussman Strategic Growth has no effect on the direction of Arbitrage Fund i.e., Arbitrage Fund and Hussman Strategic go up and down completely randomly.
Pair Corralation between Arbitrage Fund and Hussman Strategic
Assuming the 90 days horizon Arbitrage Fund is expected to generate 4.71 times less return on investment than Hussman Strategic. But when comparing it to its historical volatility, The Arbitrage Fund is 2.1 times less risky than Hussman Strategic. It trades about 0.04 of its potential returns per unit of risk. Hussman Strategic Growth is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 545.00 in Hussman Strategic Growth on September 14, 2024 and sell it today you would earn a total of 4.00 from holding Hussman Strategic Growth or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Arbitrage Fund vs. Hussman Strategic Growth
Performance |
| Timeline |
| Arbitrage Fund |
| Hussman Strategic Growth |
Arbitrage Fund and Hussman Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arbitrage Fund and Hussman Strategic
The main advantage of trading using opposite Arbitrage Fund and Hussman Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arbitrage Fund position performs unexpectedly, Hussman Strategic 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 Hussman Strategic will offset losses from the drop in Hussman Strategic's long position.| Arbitrage Fund vs. The Arbitrage Fund | Arbitrage Fund vs. The Arbitrage Fund | Arbitrage Fund vs. The Arbitrage Credit | Arbitrage Fund vs. The Arbitrage Fund |
| Hussman Strategic vs. Hussman Strategic Allocation | Hussman Strategic vs. Hussman Strategic Dividend | Hussman Strategic vs. Hussman Strategic Total | Hussman Strategic vs. American Funds Global |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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