Correlation Between Chase Growth and Growth Fund
Can any of the company-specific risk be diversified away by investing in both Chase Growth and Growth Fund 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 Growth Fund 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 Growth Fund Of, you can compare the effects of market volatilities on Chase Growth and Growth Fund 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 Growth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chase Growth and Growth Fund.
Diversification Opportunities for Chase Growth and Growth Fund
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chase and Growth is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Chase Growth Fund and Growth Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Fund 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 Growth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Fund has no effect on the direction of Chase Growth i.e., Chase Growth and Growth Fund go up and down completely randomly.
Pair Corralation between Chase Growth and Growth Fund
Assuming the 90 days horizon Chase Growth Fund is expected to generate 0.99 times more return on investment than Growth Fund. However, Chase Growth Fund is 1.01 times less risky than Growth Fund. It trades about 0.12 of its potential returns per unit of risk. Growth Fund Of is currently generating about 0.1 per unit of risk. If you would invest 1,418 in Chase Growth Fund on September 1, 2024 and sell it today you would earn a total of 344.00 from holding Chase Growth Fund or generate 24.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.47% |
| Values | Daily Returns |
Chase Growth Fund vs. Growth Fund Of
Performance |
| Timeline |
| Chase Growth |
| Growth Fund |
Chase Growth and Growth Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chase Growth and Growth Fund
The main advantage of trading using opposite Chase Growth and Growth Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chase Growth position performs unexpectedly, Growth Fund 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 Growth Fund will offset losses from the drop in Growth Fund'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 |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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