Correlation Between American Funds and Ladenburg Aggressive
Can any of the company-specific risk be diversified away by investing in both American Funds and Ladenburg Aggressive 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 Ladenburg Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds Inflation and Ladenburg Aggressive Growth, you can compare the effects of market volatilities on American Funds and Ladenburg Aggressive 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 Ladenburg Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Ladenburg Aggressive.
Diversification Opportunities for American Funds and Ladenburg Aggressive
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and Ladenburg is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Inflation and Ladenburg Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladenburg Aggressive 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 Inflation are associated (or correlated) with Ladenburg Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladenburg Aggressive has no effect on the direction of American Funds i.e., American Funds and Ladenburg Aggressive go up and down completely randomly.
Pair Corralation between American Funds and Ladenburg Aggressive
Assuming the 90 days horizon American Funds is expected to generate 8.62 times less return on investment than Ladenburg Aggressive. But when comparing it to its historical volatility, American Funds Inflation is 3.47 times less risky than Ladenburg Aggressive. It trades about 0.15 of its potential returns per unit of risk. Ladenburg Aggressive Growth is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 1,910 in Ladenburg Aggressive Growth on September 2, 2024 and sell it today you would earn a total of 126.00 from holding Ladenburg Aggressive Growth or generate 6.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Funds Inflation vs. Ladenburg Aggressive Growth
Performance |
| Timeline |
| American Funds Inflation |
| Ladenburg Aggressive |
American Funds and Ladenburg Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Ladenburg Aggressive
The main advantage of trading using opposite American Funds and Ladenburg Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Ladenburg Aggressive 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 Ladenburg Aggressive will offset losses from the drop in Ladenburg Aggressive's long position.| American Funds vs. Income Fund Of | American Funds vs. New World Fund | American Funds vs. American Mutual Fund | American Funds vs. American Mutual Fund |
| Ladenburg Aggressive vs. Ladenburg Growth | Ladenburg Aggressive vs. Ladenburg Growth | Ladenburg Aggressive vs. Ladenburg Growth | Ladenburg Aggressive vs. Ladenburg Income Fundclass |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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