Correlation Between Boston Partners and New Alternatives
Can any of the company-specific risk be diversified away by investing in both Boston Partners and New Alternatives 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 Boston Partners and New Alternatives into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Partners Small and New Alternatives Fund, you can compare the effects of market volatilities on Boston Partners and New Alternatives 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 Boston Partners with a short position of New Alternatives. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Partners and New Alternatives.
Diversification Opportunities for Boston Partners and New Alternatives
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Boston and New is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Boston Partners Small and New Alternatives Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Alternatives and Boston Partners 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 Boston Partners Small are associated (or correlated) with New Alternatives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Alternatives has no effect on the direction of Boston Partners i.e., Boston Partners and New Alternatives go up and down completely randomly.
Pair Corralation between Boston Partners and New Alternatives
Assuming the 90 days horizon Boston Partners Small is expected to generate 1.17 times more return on investment than New Alternatives. However, Boston Partners is 1.17 times more volatile than New Alternatives Fund. It trades about 0.16 of its potential returns per unit of risk. New Alternatives Fund is currently generating about -0.09 per unit of risk. If you would invest 2,588 in Boston Partners Small on September 12, 2024 and sell it today you would earn a total of 310.00 from holding Boston Partners Small or generate 11.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Partners Small vs. New Alternatives Fund
Performance |
| Timeline |
| Boston Partners Small |
| New Alternatives |
Boston Partners and New Alternatives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Partners and New Alternatives
The main advantage of trading using opposite Boston Partners and New Alternatives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Partners position performs unexpectedly, New Alternatives 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 New Alternatives will offset losses from the drop in New Alternatives' long position.| Boston Partners vs. Aggressive Investors 1 | Boston Partners vs. Buffalo Small Cap | Boston Partners vs. Rice Hall James | Boston Partners vs. Putnam Small Cap |
| New Alternatives vs. Transamerica Emerging Markets | New Alternatives vs. T Rowe Price | New Alternatives vs. Barings Emerging Markets | New Alternatives vs. Origin Emerging Markets |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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