Correlation Between American Century and Clearbridge Focus
Can any of the company-specific risk be diversified away by investing in both American Century and Clearbridge Focus 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 Century and Clearbridge Focus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Century ETF and Clearbridge Focus Value, you can compare the effects of market volatilities on American Century and Clearbridge Focus 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 Century with a short position of Clearbridge Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Century and Clearbridge Focus.
Diversification Opportunities for American Century and Clearbridge Focus
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Clearbridge is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding American Century ETF and Clearbridge Focus Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Focus Value and American Century 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 Century ETF are associated (or correlated) with Clearbridge Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Focus Value has no effect on the direction of American Century i.e., American Century and Clearbridge Focus go up and down completely randomly.
Pair Corralation between American Century and Clearbridge Focus
If you would invest 9,480 in American Century ETF on September 2, 2024 and sell it today you would earn a total of 904.00 from holding American Century ETF or generate 9.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 23.81% |
| Values | Daily Returns |
American Century ETF vs. Clearbridge Focus Value
Performance |
| Timeline |
| American Century ETF |
| Clearbridge Focus Value |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Century and Clearbridge Focus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Century and Clearbridge Focus
The main advantage of trading using opposite American Century and Clearbridge Focus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Century position performs unexpectedly, Clearbridge Focus 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 Clearbridge Focus will offset losses from the drop in Clearbridge Focus' long position.| American Century vs. Invesco DWA Technology | American Century vs. CNX Resources Corp | American Century vs. Natural Resource Partners | American Century vs. Albertsons Companies |
| Clearbridge Focus vs. American Century ETF | Clearbridge Focus vs. FT Cboe Vest | Clearbridge Focus vs. First Trust Exchange Traded | Clearbridge Focus vs. FT Cboe Vest |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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