Correlation Between Eventide Gilead and Smead Value
Can any of the company-specific risk be diversified away by investing in both Eventide Gilead and Smead Value 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 Eventide Gilead and Smead Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eventide Gilead Fund and Smead Value Fund, you can compare the effects of market volatilities on Eventide Gilead and Smead Value 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 Eventide Gilead with a short position of Smead Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eventide Gilead and Smead Value.
Diversification Opportunities for Eventide Gilead and Smead Value
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eventide and Smead is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Eventide Gilead Fund and Smead Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smead Value Fund and Eventide Gilead 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 Eventide Gilead Fund are associated (or correlated) with Smead Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smead Value Fund has no effect on the direction of Eventide Gilead i.e., Eventide Gilead and Smead Value go up and down completely randomly.
Pair Corralation between Eventide Gilead and Smead Value
Assuming the 90 days horizon Eventide Gilead Fund is expected to generate 1.68 times more return on investment than Smead Value. However, Eventide Gilead is 1.68 times more volatile than Smead Value Fund. It trades about 0.23 of its potential returns per unit of risk. Smead Value Fund is currently generating about 0.15 per unit of risk. If you would invest 5,009 in Eventide Gilead Fund on November 3, 2024 and sell it today you would earn a total of 313.00 from holding Eventide Gilead Fund or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eventide Gilead Fund vs. Smead Value Fund
Performance |
| Timeline |
| Eventide Gilead |
| Smead Value Fund |
Eventide Gilead and Smead Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eventide Gilead and Smead Value
The main advantage of trading using opposite Eventide Gilead and Smead Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eventide Gilead position performs unexpectedly, Smead Value 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 Smead Value will offset losses from the drop in Smead Value's long position.| Eventide Gilead vs. Ftufox | Eventide Gilead vs. Wabmsx | Eventide Gilead vs. Arrow Managed Futures | Eventide Gilead vs. Rational Dividend Capture |
| Smead Value vs. Matthew 25 Fund | Smead Value vs. Baron Real Estate | Smead Value vs. Buffalo Emerging Opportunities | Smead Value vs. Eventide Gilead Fund |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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