Correlation Between Eic Value and Praxis Growth
Can any of the company-specific risk be diversified away by investing in both Eic Value and Praxis Growth 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 Eic Value and Praxis Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eic Value Fund and Praxis Growth Index, you can compare the effects of market volatilities on Eic Value and Praxis Growth 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 Eic Value with a short position of Praxis Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eic Value and Praxis Growth.
Diversification Opportunities for Eic Value and Praxis Growth
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eic and Praxis is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Eic Value Fund and Praxis Growth Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Praxis Growth Index and Eic 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 Eic Value Fund are associated (or correlated) with Praxis Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Praxis Growth Index has no effect on the direction of Eic Value i.e., Eic Value and Praxis Growth go up and down completely randomly.
Pair Corralation between Eic Value and Praxis Growth
Assuming the 90 days horizon Eic Value is expected to generate 2.4 times less return on investment than Praxis Growth. But when comparing it to its historical volatility, Eic Value Fund is 1.73 times less risky than Praxis Growth. It trades about 0.07 of its potential returns per unit of risk. Praxis Growth Index is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,030 in Praxis Growth Index on October 14, 2024 and sell it today you would earn a total of 849.00 from holding Praxis Growth Index or generate 21.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eic Value Fund vs. Praxis Growth Index
Performance |
| Timeline |
| Eic Value Fund |
| Praxis Growth Index |
Eic Value and Praxis Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eic Value and Praxis Growth
The main advantage of trading using opposite Eic Value and Praxis Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eic Value position performs unexpectedly, Praxis Growth 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 Praxis Growth will offset losses from the drop in Praxis Growth's long position.| Eic Value vs. Kinetics Small Cap | Eic Value vs. Sp Smallcap 600 | Eic Value vs. Champlain Small | Eic Value vs. Artisan Small Cap |
| Praxis Growth vs. Tax Managed Large Cap | Praxis Growth vs. Fmasx | Praxis Growth vs. Eic Value Fund | Praxis Growth vs. Kirr Marbach Partners |
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 CEOs Directory module to screen CEOs from public companies around the world.
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