Correlation Between Chase Growth and Dana Large
Can any of the company-specific risk be diversified away by investing in both Chase Growth and Dana Large 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 Chase Growth and Dana Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chase Growth Fund and Dana Large Cap, you can compare the effects of market volatilities on Chase Growth and Dana Large 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 Chase Growth with a short position of Dana Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chase Growth and Dana Large.
Diversification Opportunities for Chase Growth and Dana Large
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chase and Dana is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Chase Growth Fund and Dana Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Large Cap and Chase 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 Chase Growth Fund are associated (or correlated) with Dana Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Large Cap has no effect on the direction of Chase Growth i.e., Chase Growth and Dana Large go up and down completely randomly.
Pair Corralation between Chase Growth and Dana Large
Assuming the 90 days horizon Chase Growth Fund is expected to under-perform the Dana Large. In addition to that, Chase Growth is 6.83 times more volatile than Dana Large Cap. It trades about -0.21 of its total potential returns per unit of risk. Dana Large Cap is currently generating about 0.09 per unit of volatility. If you would invest 2,695 in Dana Large Cap on September 13, 2024 and sell it today you would earn a total of 27.00 from holding Dana Large Cap or generate 1.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chase Growth Fund vs. Dana Large Cap
Performance |
| Timeline |
| Chase Growth |
| Dana Large Cap |
Chase Growth and Dana Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chase Growth and Dana Large
The main advantage of trading using opposite Chase Growth and Dana Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chase Growth position performs unexpectedly, Dana Large 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 Dana Large will offset losses from the drop in Dana Large's long position.| Chase Growth vs. The Chesapeake Growth | Chase Growth vs. Aston Montag Caldwell | Chase Growth vs. The Jensen Portfolio | Chase Growth vs. Cambiar Opportunity Fund |
| Dana Large vs. Mid Cap Growth | Dana Large vs. Franklin Growth Opportunities | Dana Large vs. Needham Aggressive Growth | Dana Large vs. Tfa Alphagen Growth |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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