Correlation Between Ep Emerging and Alger Capital
Can any of the company-specific risk be diversified away by investing in both Ep Emerging and Alger Capital 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 Ep Emerging and Alger Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ep Emerging Markets and Alger Capital Appreciation, you can compare the effects of market volatilities on Ep Emerging and Alger Capital 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 Ep Emerging with a short position of Alger Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and Alger Capital.
Diversification Opportunities for Ep Emerging and Alger Capital
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EPEIX and Alger is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and Alger Capital Appreciation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Capital Apprec and Ep Emerging 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 Ep Emerging Markets are associated (or correlated) with Alger Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Capital Apprec has no effect on the direction of Ep Emerging i.e., Ep Emerging and Alger Capital go up and down completely randomly.
Pair Corralation between Ep Emerging and Alger Capital
Assuming the 90 days horizon Ep Emerging Markets is expected to under-perform the Alger Capital. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ep Emerging Markets is 1.47 times less risky than Alger Capital. The mutual fund trades about -0.05 of its potential returns per unit of risk. The Alger Capital Appreciation is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,727 in Alger Capital Appreciation on September 13, 2024 and sell it today you would earn a total of 201.00 from holding Alger Capital Appreciation or generate 5.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ep Emerging Markets vs. Alger Capital Appreciation
Performance |
| Timeline |
| Ep Emerging Markets |
| Alger Capital Apprec |
Ep Emerging and Alger Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ep Emerging and Alger Capital
The main advantage of trading using opposite Ep Emerging and Alger Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ep Emerging position performs unexpectedly, Alger Capital 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 Alger Capital will offset losses from the drop in Alger Capital's long position.| Ep Emerging vs. Oaktree Diversifiedome | Ep Emerging vs. Sentinel Small Pany | Ep Emerging vs. Davenport Small Cap | Ep Emerging vs. Fidelity Advisor Diversified |
| Alger Capital vs. Dana Large Cap | Alger Capital vs. Guidemark Large Cap | Alger Capital vs. Avantis Large Cap | Alger Capital vs. Qs Large Cap |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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