Correlation Between Champlain Small and Chartwell Short
Can any of the company-specific risk be diversified away by investing in both Champlain Small and Chartwell Short 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 Champlain Small and Chartwell Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champlain Small and Chartwell Short Duration, you can compare the effects of market volatilities on Champlain Small and Chartwell Short 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 Champlain Small with a short position of Chartwell Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champlain Small and Chartwell Short.
Diversification Opportunities for Champlain Small and Chartwell Short
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Champlain and Chartwell is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Champlain Small and Chartwell Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chartwell Short Duration and Champlain Small 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 Champlain Small are associated (or correlated) with Chartwell Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chartwell Short Duration has no effect on the direction of Champlain Small i.e., Champlain Small and Chartwell Short go up and down completely randomly.
Pair Corralation between Champlain Small and Chartwell Short
Assuming the 90 days horizon Champlain Small is expected to generate 14.31 times more return on investment than Chartwell Short. However, Champlain Small is 14.31 times more volatile than Chartwell Short Duration. It trades about 0.26 of its potential returns per unit of risk. Chartwell Short Duration is currently generating about 0.21 per unit of risk. If you would invest 2,333 in Champlain Small on August 31, 2024 and sell it today you would earn a total of 217.00 from holding Champlain Small or generate 9.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Champlain Small vs. Chartwell Short Duration
Performance |
| Timeline |
| Champlain Small |
| Chartwell Short Duration |
Champlain Small and Chartwell Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champlain Small and Chartwell Short
The main advantage of trading using opposite Champlain Small and Chartwell Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champlain Small position performs unexpectedly, Chartwell Short 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 Chartwell Short will offset losses from the drop in Chartwell Short's long position.| Champlain Small vs. The Hartford Midcap | Champlain Small vs. Mfs Emerging Markets | Champlain Small vs. Wells Fargo Special | Champlain Small vs. Baron Emerging Markets |
| Chartwell Short vs. Kinetics Small Cap | Chartwell Short vs. Baird Smallmid Cap | Chartwell Short vs. Chartwell Small Cap | Chartwell Short vs. Champlain Small |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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