Correlation Between Chase Growth and Vaughan Nelson
Can any of the company-specific risk be diversified away by investing in both Chase Growth and Vaughan Nelson 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 Vaughan Nelson 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 Vaughan Nelson Select, you can compare the effects of market volatilities on Chase Growth and Vaughan Nelson 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 Vaughan Nelson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chase Growth and Vaughan Nelson.
Diversification Opportunities for Chase Growth and Vaughan Nelson
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chase and Vaughan is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Chase Growth Fund and Vaughan Nelson Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vaughan Nelson Select 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 Vaughan Nelson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vaughan Nelson Select has no effect on the direction of Chase Growth i.e., Chase Growth and Vaughan Nelson go up and down completely randomly.
Pair Corralation between Chase Growth and Vaughan Nelson
Assuming the 90 days horizon Chase Growth Fund is expected to generate 0.9 times more return on investment than Vaughan Nelson. However, Chase Growth Fund is 1.11 times less risky than Vaughan Nelson. It trades about 0.23 of its potential returns per unit of risk. Vaughan Nelson Select is currently generating about 0.11 per unit of risk. If you would invest 1,671 in Chase Growth Fund on August 28, 2024 and sell it today you would earn a total of 88.00 from holding Chase Growth Fund or generate 5.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chase Growth Fund vs. Vaughan Nelson Select
Performance |
| Timeline |
| Chase Growth |
| Vaughan Nelson Select |
Chase Growth and Vaughan Nelson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chase Growth and Vaughan Nelson
The main advantage of trading using opposite Chase Growth and Vaughan Nelson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chase Growth position performs unexpectedly, Vaughan Nelson 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 Vaughan Nelson will offset losses from the drop in Vaughan Nelson'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 |
| Vaughan Nelson vs. Virtus Convertible | Vaughan Nelson vs. Advent Claymore Convertible | Vaughan Nelson vs. Lord Abbett Vertible | Vaughan Nelson vs. Mainstay Vertible Fund |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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