Correlation Between Conestoga Smid and Polen Growth
Can any of the company-specific risk be diversified away by investing in both Conestoga Smid and Polen Growth 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 Conestoga Smid and Polen Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Conestoga Smid Cap and Polen Growth Fund, you can compare the effects of market volatilities on Conestoga Smid and Polen Growth 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 Conestoga Smid with a short position of Polen Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Conestoga Smid and Polen Growth.
Diversification Opportunities for Conestoga Smid and Polen Growth
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Conestoga and Polen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Conestoga Smid Cap and Polen Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polen Growth and Conestoga Smid 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 Conestoga Smid Cap are associated (or correlated) with Polen Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polen Growth has no effect on the direction of Conestoga Smid i.e., Conestoga Smid and Polen Growth go up and down completely randomly.
Pair Corralation between Conestoga Smid and Polen Growth
Assuming the 90 days horizon Conestoga Smid is expected to generate 3.19 times less return on investment than Polen Growth. In addition to that, Conestoga Smid is 1.06 times more volatile than Polen Growth Fund. It trades about 0.01 of its total potential returns per unit of risk. Polen Growth Fund is currently generating about 0.03 per unit of volatility. If you would invest 4,459 in Polen Growth Fund on November 28, 2024 and sell it today you would earn a total of 131.00 from holding Polen Growth Fund or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Conestoga Smid Cap vs. Polen Growth Fund
Performance |
| Timeline |
| Conestoga Smid Cap |
| Polen Growth |
Conestoga Smid and Polen Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Conestoga Smid and Polen Growth
The main advantage of trading using opposite Conestoga Smid and Polen Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Conestoga Smid position performs unexpectedly, Polen Growth 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 Polen Growth will offset losses from the drop in Polen Growth's long position.| Conestoga Smid vs. Conestoga Small Cap | Conestoga Smid vs. Ycg Enhanced Fund | Conestoga Smid vs. Df Dent Premier | Conestoga Smid vs. Polen Growth Fund |
| Polen Growth vs. Polen Growth Fund | Polen Growth vs. Edgewood Growth Fund | Polen Growth vs. Akre Focus Fund | Polen Growth vs. Brown Advisory Sustainable |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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