Correlation Between American Funds and Harbor High-yield
Can any of the company-specific risk be diversified away by investing in both American Funds and Harbor High-yield 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 American Funds and Harbor High-yield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds American and Harbor High Yield Bond, you can compare the effects of market volatilities on American Funds and Harbor High-yield 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 American Funds with a short position of Harbor High-yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Harbor High-yield.
Diversification Opportunities for American Funds and Harbor High-yield
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Harbor is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding American Funds American and Harbor High Yield Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor High Yield and American Funds 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 American Funds American are associated (or correlated) with Harbor High-yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor High Yield has no effect on the direction of American Funds i.e., American Funds and Harbor High-yield go up and down completely randomly.
Pair Corralation between American Funds and Harbor High-yield
If you would invest 911.00 in American Funds American on September 1, 2024 and sell it today you would earn a total of 75.00 from holding American Funds American or generate 8.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.53% |
| Values | Daily Returns |
American Funds American vs. Harbor High Yield Bond
Performance |
| Timeline |
| American Funds American |
| Harbor High Yield |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Funds and Harbor High-yield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Harbor High-yield
The main advantage of trading using opposite American Funds and Harbor High-yield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Harbor High-yield 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 Harbor High-yield will offset losses from the drop in Harbor High-yield's long position.| American Funds vs. Technology Ultrasector Profund | American Funds vs. Icon Information Technology | American Funds vs. Allianzgi Technology Fund | American Funds vs. Blackrock Science Technology |
| Harbor High-yield vs. Aqr Risk Balanced Modities | Harbor High-yield vs. Lgm Risk Managed | Harbor High-yield vs. Western Asset High | Harbor High-yield vs. Pioneer High Yield |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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