Correlation Between Auer Growth and Inflation-linked
Can any of the company-specific risk be diversified away by investing in both Auer Growth and Inflation-linked 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 Inflation-linked 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 Inflation Linked Fixed Income, you can compare the effects of market volatilities on Auer Growth and Inflation-linked 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 Inflation-linked. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auer Growth and Inflation-linked.
Diversification Opportunities for Auer Growth and Inflation-linked
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Auer and Inflation-linked is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Auer Growth Fund and Inflation Linked Fixed Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflation Linked Fixed 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 Inflation-linked. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflation Linked Fixed has no effect on the direction of Auer Growth i.e., Auer Growth and Inflation-linked go up and down completely randomly.
Pair Corralation between Auer Growth and Inflation-linked
Assuming the 90 days horizon Auer Growth Fund is expected to generate 2.95 times more return on investment than Inflation-linked. However, Auer Growth is 2.95 times more volatile than Inflation Linked Fixed Income. It trades about 0.08 of its potential returns per unit of risk. Inflation Linked Fixed Income is currently generating about 0.08 per unit of risk. If you would invest 1,422 in Auer Growth Fund on September 4, 2024 and sell it today you would earn a total of 347.00 from holding Auer Growth Fund or generate 24.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.66% |
| Values | Daily Returns |
Auer Growth Fund vs. Inflation Linked Fixed Income
Performance |
| Timeline |
| Auer Growth Fund |
| Inflation Linked Fixed |
Auer Growth and Inflation-linked Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auer Growth and Inflation-linked
The main advantage of trading using opposite Auer Growth and Inflation-linked positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auer Growth position performs unexpectedly, Inflation-linked 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 Inflation-linked will offset losses from the drop in Inflation-linked'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 |
| Inflation-linked vs. Mutual Of America | Inflation-linked vs. Ultrasmall Cap Profund Ultrasmall Cap | Inflation-linked vs. Pace Smallmedium Value | Inflation-linked vs. Mid Cap Value Profund |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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