Correlation Between Elfun Government and First American
Can any of the company-specific risk be diversified away by investing in both Elfun Government and First American 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 Elfun Government and First American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elfun Government Money and First American Funds, you can compare the effects of market volatilities on Elfun Government and First American 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 Elfun Government with a short position of First American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Government and First American.
Diversification Opportunities for Elfun Government and First American
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Elfun and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Government Money and First American Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First American Funds and Elfun Government 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 Elfun Government Money are associated (or correlated) with First American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First American Funds has no effect on the direction of Elfun Government i.e., Elfun Government and First American go up and down completely randomly.
Pair Corralation between Elfun Government and First American
Assuming the 90 days horizon Elfun Government Money is expected to generate 1.7 times more return on investment than First American. However, Elfun Government is 1.7 times more volatile than First American Funds. It trades about 0.06 of its potential returns per unit of risk. First American Funds is currently generating about 0.03 per unit of risk. If you would invest 328.00 in Elfun Government Money on September 3, 2024 and sell it today you would lose (228.00) from holding Elfun Government Money or give up 69.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.83% |
| Values | Daily Returns |
Elfun Government Money vs. First American Funds
Performance |
| Timeline |
| Elfun Government Money |
| First American Funds |
Elfun Government and First American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elfun Government and First American
The main advantage of trading using opposite Elfun Government and First American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun Government position performs unexpectedly, First American 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 First American will offset losses from the drop in First American's long position.| Elfun Government vs. Touchstone Premium Yield | Elfun Government vs. Limited Term Tax | Elfun Government vs. Bbh Intermediate Municipal | Elfun Government vs. Versatile Bond Portfolio |
| First American vs. Vanguard Total Stock | First American vs. Vanguard 500 Index | First American vs. Vanguard Total Stock | First American vs. Vanguard Total Stock |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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