Correlation Between Cornerstone Strategic and Nicholas Fund
Can any of the company-specific risk be diversified away by investing in both Cornerstone Strategic and Nicholas 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 Cornerstone Strategic and Nicholas Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cornerstone Strategic Value and Nicholas Fund Inc, you can compare the effects of market volatilities on Cornerstone Strategic and Nicholas 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 Cornerstone Strategic with a short position of Nicholas Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cornerstone Strategic and Nicholas Fund.
Diversification Opportunities for Cornerstone Strategic and Nicholas Fund
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cornerstone and Nicholas is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Cornerstone Strategic Value and Nicholas Fund Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicholas Fund and Cornerstone Strategic 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 Cornerstone Strategic Value are associated (or correlated) with Nicholas Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicholas Fund has no effect on the direction of Cornerstone Strategic i.e., Cornerstone Strategic and Nicholas Fund go up and down completely randomly.
Pair Corralation between Cornerstone Strategic and Nicholas Fund
Considering the 90-day investment horizon Cornerstone Strategic Value is expected to generate 0.98 times more return on investment than Nicholas Fund. However, Cornerstone Strategic Value is 1.02 times less risky than Nicholas Fund. It trades about 0.62 of its potential returns per unit of risk. Nicholas Fund Inc is currently generating about 0.23 per unit of risk. If you would invest 791.00 in Cornerstone Strategic Value on August 29, 2024 and sell it today you would earn a total of 100.00 from holding Cornerstone Strategic Value or generate 12.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cornerstone Strategic Value vs. Nicholas Fund Inc
Performance |
| Timeline |
| Cornerstone Strategic |
| Nicholas Fund |
Cornerstone Strategic and Nicholas Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cornerstone Strategic and Nicholas Fund
The main advantage of trading using opposite Cornerstone Strategic and Nicholas Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cornerstone Strategic position performs unexpectedly, Nicholas 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 Nicholas Fund will offset losses from the drop in Nicholas Fund's long position.| Cornerstone Strategic vs. Gabelli Global Small | Cornerstone Strategic vs. MFS Investment Grade | Cornerstone Strategic vs. Eaton Vance National | Cornerstone Strategic vs. GAMCO Natural Resources |
| Nicholas Fund vs. Growth Fund Of | Nicholas Fund vs. HUMANA INC | Nicholas Fund vs. Aquagold International | Nicholas Fund vs. Barloworld Ltd ADR |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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