Correlation Between Dana Large and Scharf Fund
Can any of the company-specific risk be diversified away by investing in both Dana Large and Scharf 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 Dana Large and Scharf Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Large Cap and Scharf Fund Retail, you can compare the effects of market volatilities on Dana Large and Scharf 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 Dana Large with a short position of Scharf Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana Large and Scharf Fund.
Diversification Opportunities for Dana Large and Scharf Fund
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dana and Scharf is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Dana Large Cap and Scharf Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scharf Fund Retail and Dana Large 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 Dana Large Cap are associated (or correlated) with Scharf Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scharf Fund Retail has no effect on the direction of Dana Large i.e., Dana Large and Scharf Fund go up and down completely randomly.
Pair Corralation between Dana Large and Scharf Fund
Assuming the 90 days horizon Dana Large Cap is expected to generate 1.07 times more return on investment than Scharf Fund. However, Dana Large is 1.07 times more volatile than Scharf Fund Retail. It trades about 0.02 of its potential returns per unit of risk. Scharf Fund Retail is currently generating about -0.13 per unit of risk. If you would invest 2,696 in Dana Large Cap on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Dana Large Cap or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Large Cap vs. Scharf Fund Retail
Performance |
| Timeline |
| Dana Large Cap |
| Scharf Fund Retail |
Dana Large and Scharf Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana Large and Scharf Fund
The main advantage of trading using opposite Dana Large and Scharf Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana Large position performs unexpectedly, Scharf 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 Scharf Fund will offset losses from the drop in Scharf Fund's long position.| Dana Large vs. Intermediate Government Bond | Dana Large vs. Prudential Government Income | Dana Large vs. Us Government Securities | Dana Large vs. Virtus Seix Government |
| Scharf Fund vs. Gmo Resources | Scharf Fund vs. Icon Natural Resources | Scharf Fund vs. Fidelity Advisor Energy | Scharf Fund vs. Oil Gas Ultrasector |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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