Correlation Between Auer Growth and Invesco High
Can any of the company-specific risk be diversified away by investing in both Auer Growth and Invesco High 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 Auer Growth and Invesco High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auer Growth Fund and Invesco High Yield, you can compare the effects of market volatilities on Auer Growth and Invesco High 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 Auer Growth with a short position of Invesco High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auer Growth and Invesco High.
Diversification Opportunities for Auer Growth and Invesco High
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Auer and Invesco is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Auer Growth Fund and Invesco High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco High Yield and Auer 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 Auer Growth Fund are associated (or correlated) with Invesco High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco High Yield has no effect on the direction of Auer Growth i.e., Auer Growth and Invesco High go up and down completely randomly.
Pair Corralation between Auer Growth and Invesco High
Assuming the 90 days horizon Auer Growth Fund is expected to generate 3.25 times more return on investment than Invesco High. However, Auer Growth is 3.25 times more volatile than Invesco High Yield. It trades about 0.06 of its potential returns per unit of risk. Invesco High Yield is currently generating about 0.07 per unit of risk. If you would invest 1,261 in Auer Growth Fund on September 12, 2024 and sell it today you would earn a total of 485.00 from holding Auer Growth Fund or generate 38.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auer Growth Fund vs. Invesco High Yield
Performance |
| Timeline |
| Auer Growth Fund |
| Invesco High Yield |
Auer Growth and Invesco High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auer Growth and Invesco High
The main advantage of trading using opposite Auer Growth and Invesco High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auer Growth position performs unexpectedly, Invesco High 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 Invesco High will offset losses from the drop in Invesco High's long position.| Auer Growth vs. Lebenthal Lisanti Small | Auer Growth vs. Hodges Small Cap | Auer Growth vs. Schwartz Value Focused | Auer Growth vs. Oberweis Small Cap Opportunities |
| Invesco High vs. T Rowe Price | Invesco High vs. Volumetric Fund Volumetric | Invesco High vs. Auer Growth Fund | Invesco High vs. Balanced Fund Investor |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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