Correlation Between Delaware Value and Pear Tree
Can any of the company-specific risk be diversified away by investing in both Delaware Value and Pear Tree 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 Delaware Value and Pear Tree into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delaware Value Fund and Pear Tree Polaris, you can compare the effects of market volatilities on Delaware Value and Pear Tree 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 Delaware Value with a short position of Pear Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delaware Value and Pear Tree.
Diversification Opportunities for Delaware Value and Pear Tree
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Delaware and Pear is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Delaware Value Fund and Pear Tree Polaris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pear Tree Polaris and Delaware Value 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 Delaware Value Fund are associated (or correlated) with Pear Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pear Tree Polaris has no effect on the direction of Delaware Value i.e., Delaware Value and Pear Tree go up and down completely randomly.
Pair Corralation between Delaware Value and Pear Tree
Assuming the 90 days horizon Delaware Value Fund is expected to generate 0.99 times more return on investment than Pear Tree. However, Delaware Value Fund is 1.01 times less risky than Pear Tree. It trades about 0.23 of its potential returns per unit of risk. Pear Tree Polaris is currently generating about -0.16 per unit of risk. If you would invest 1,843 in Delaware Value Fund on August 29, 2024 and sell it today you would earn a total of 72.00 from holding Delaware Value Fund or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delaware Value Fund vs. Pear Tree Polaris
Performance |
| Timeline |
| Delaware Value |
| Pear Tree Polaris |
Delaware Value and Pear Tree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delaware Value and Pear Tree
The main advantage of trading using opposite Delaware Value and Pear Tree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delaware Value position performs unexpectedly, Pear Tree 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 Pear Tree will offset losses from the drop in Pear Tree's long position.| Delaware Value vs. Dodge Cox Stock | Delaware Value vs. American Mutual Fund | Delaware Value vs. American Funds American | Delaware Value vs. American Funds American |
| Pear Tree vs. HUMANA INC | Pear Tree vs. Aquagold International | Pear Tree vs. Barloworld Ltd ADR | Pear Tree vs. Morningstar Unconstrained Allocation |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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