Correlation Between Cullen International and Growth Opportunities
Can any of the company-specific risk be diversified away by investing in both Cullen International and Growth Opportunities 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 Cullen International and Growth Opportunities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cullen International High and Growth Opportunities Fund, you can compare the effects of market volatilities on Cullen International and Growth Opportunities 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 Cullen International with a short position of Growth Opportunities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cullen International and Growth Opportunities.
Diversification Opportunities for Cullen International and Growth Opportunities
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cullen and Growth is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cullen International High and Growth Opportunities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Opportunities and Cullen International 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 Cullen International High are associated (or correlated) with Growth Opportunities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Opportunities has no effect on the direction of Cullen International i.e., Cullen International and Growth Opportunities go up and down completely randomly.
Pair Corralation between Cullen International and Growth Opportunities
Assuming the 90 days horizon Cullen International High is expected to under-perform the Growth Opportunities. But the mutual fund apears to be less risky and, when comparing its historical volatility, Cullen International High is 1.44 times less risky than Growth Opportunities. The mutual fund trades about 0.0 of its potential returns per unit of risk. The Growth Opportunities Fund is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 5,174 in Growth Opportunities Fund on September 3, 2024 and sell it today you would earn a total of 682.00 from holding Growth Opportunities Fund or generate 13.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cullen International High vs. Growth Opportunities Fund
Performance |
| Timeline |
| Cullen International High |
| Growth Opportunities |
Cullen International and Growth Opportunities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cullen International and Growth Opportunities
The main advantage of trading using opposite Cullen International and Growth Opportunities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cullen International position performs unexpectedly, Growth Opportunities 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 Opportunities will offset losses from the drop in Growth Opportunities' long position.| Cullen International vs. Ab Global Real | Cullen International vs. Scharf Global Opportunity | Cullen International vs. Ab Global Real | Cullen International vs. Morningstar Global Income |
| Growth Opportunities vs. Victory Rs Partners | Growth Opportunities vs. Lord Abbett Small | Growth Opportunities vs. Hennessy Nerstone Mid | Growth Opportunities vs. Fpa Queens Road |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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