Correlation Between Edgewood Growth and Polen Global
Can any of the company-specific risk be diversified away by investing in both Edgewood Growth and Polen Global 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 Edgewood Growth and Polen Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edgewood Growth Fund and Polen Global Growth, you can compare the effects of market volatilities on Edgewood Growth and Polen Global 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 Edgewood Growth with a short position of Polen Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edgewood Growth and Polen Global.
Diversification Opportunities for Edgewood Growth and Polen Global
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Edgewood and Polen is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Edgewood Growth Fund and Polen Global Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polen Global Growth and Edgewood Growth 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 Edgewood Growth Fund are associated (or correlated) with Polen Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polen Global Growth has no effect on the direction of Edgewood Growth i.e., Edgewood Growth and Polen Global go up and down completely randomly.
Pair Corralation between Edgewood Growth and Polen Global
Assuming the 90 days horizon Edgewood Growth is expected to generate 1.91 times less return on investment than Polen Global. In addition to that, Edgewood Growth is 1.25 times more volatile than Polen Global Growth. It trades about 0.13 of its total potential returns per unit of risk. Polen Global Growth is currently generating about 0.31 per unit of volatility. If you would invest 2,575 in Polen Global Growth on November 3, 2024 and sell it today you would earn a total of 130.00 from holding Polen Global Growth or generate 5.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Edgewood Growth Fund vs. Polen Global Growth
Performance |
| Timeline |
| Edgewood Growth |
| Polen Global Growth |
Edgewood Growth and Polen Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edgewood Growth and Polen Global
The main advantage of trading using opposite Edgewood Growth and Polen Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edgewood Growth position performs unexpectedly, Polen Global 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 Polen Global will offset losses from the drop in Polen Global's long position.| Edgewood Growth vs. Edgewood Growth Fund | Edgewood Growth vs. Polen Growth Fund | Edgewood Growth vs. Doubleline Shiller Enhanced | Edgewood Growth vs. Parnassus Endeavor Fund |
| Polen Global vs. Polen Growth Fund | Polen Global vs. Baron Global Advantage | Polen Global vs. Polen Growth Fund | Polen Global vs. Polen Global Growth |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |