Correlation Between American Funds and Saat Aggressive
Can any of the company-specific risk be diversified away by investing in both American Funds and Saat 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 Saat 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 Saat Aggressive Strategy, you can compare the effects of market volatilities on American Funds and Saat 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 Saat Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Saat Aggressive.
Diversification Opportunities for American Funds and Saat Aggressive
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between American and Saat is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Inflation and Saat Aggressive Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Aggressive Strategy 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 Saat Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Aggressive Strategy has no effect on the direction of American Funds i.e., American Funds and Saat Aggressive go up and down completely randomly.
Pair Corralation between American Funds and Saat Aggressive
Assuming the 90 days horizon American Funds is expected to generate 585.0 times less return on investment than Saat Aggressive. But when comparing it to its historical volatility, American Funds Inflation is 1.93 times less risky than Saat Aggressive. It trades about 0.0 of its potential returns per unit of risk. Saat Aggressive Strategy is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 1,422 in Saat Aggressive Strategy on September 1, 2024 and sell it today you would earn a total of 53.00 from holding Saat Aggressive Strategy or generate 3.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Funds Inflation vs. Saat Aggressive Strategy
Performance |
| Timeline |
| American Funds Inflation |
| Saat Aggressive Strategy |
American Funds and Saat Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Saat Aggressive
The main advantage of trading using opposite American Funds and Saat Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Saat 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 Saat Aggressive will offset losses from the drop in Saat Aggressive's long position.| American Funds vs. Pace Large Growth | American Funds vs. Legg Mason Bw | American Funds vs. Tax Managed Large Cap | American Funds vs. Strategic Allocation Aggressive |
| Saat Aggressive vs. Transamerica Cleartrack Retirement | Saat Aggressive vs. Franklin Lifesmart Retirement | Saat Aggressive vs. Moderately Aggressive Balanced | Saat Aggressive vs. Lifestyle Ii Moderate |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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