Correlation Between Bruce Fund and Northern
Can any of the company-specific risk be diversified away by investing in both Bruce Fund and Northern 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 Bruce Fund and Northern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bruce Fund Bruce and Northern Quality Esg, you can compare the effects of market volatilities on Bruce Fund and Northern 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 Bruce Fund with a short position of Northern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bruce Fund and Northern.
Diversification Opportunities for Bruce Fund and Northern
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bruce and Northern is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Bruce Fund Bruce and Northern Quality Esg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Quality Esg and Bruce 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 Bruce Fund Bruce are associated (or correlated) with Northern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Quality Esg has no effect on the direction of Bruce Fund i.e., Bruce Fund and Northern go up and down completely randomly.
Pair Corralation between Bruce Fund and Northern
Assuming the 90 days horizon Bruce Fund Bruce is expected to generate 0.68 times more return on investment than Northern. However, Bruce Fund Bruce is 1.48 times less risky than Northern. It trades about 0.18 of its potential returns per unit of risk. Northern Quality Esg is currently generating about -0.08 per unit of risk. If you would invest 50,903 in Bruce Fund Bruce on November 27, 2024 and sell it today you would earn a total of 844.00 from holding Bruce Fund Bruce or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bruce Fund Bruce vs. Northern Quality Esg
Performance |
| Timeline |
| Bruce Fund Bruce |
| Northern Quality Esg |
Bruce Fund and Northern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bruce Fund and Northern
The main advantage of trading using opposite Bruce Fund and Northern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bruce Fund position performs unexpectedly, Northern 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 Northern will offset losses from the drop in Northern's long position.| Bruce Fund vs. Short Real Estate | Bruce Fund vs. Redwood Real Estate | Bruce Fund vs. Forum Real Estate | Bruce Fund vs. Global Real Estate |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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