Correlation Between Quantex Fund and American Funds
Can any of the company-specific risk be diversified away by investing in both Quantex Fund and American Funds 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 Quantex Fund and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quantex Fund Retail and American Funds Growth, you can compare the effects of market volatilities on Quantex Fund and American Funds 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 Quantex Fund with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quantex Fund and American Funds.
Diversification Opportunities for Quantex Fund and American Funds
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Quantex and American is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Quantex Fund Retail and American Funds Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds Growth and Quantex Fund 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 Quantex Fund Retail are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds Growth has no effect on the direction of Quantex Fund i.e., Quantex Fund and American Funds go up and down completely randomly.
Pair Corralation between Quantex Fund and American Funds
Assuming the 90 days horizon Quantex Fund is expected to generate 1.68 times less return on investment than American Funds. In addition to that, Quantex Fund is 1.08 times more volatile than American Funds Growth. It trades about 0.06 of its total potential returns per unit of risk. American Funds Growth is currently generating about 0.1 per unit of volatility. If you would invest 1,808 in American Funds Growth on September 3, 2024 and sell it today you would earn a total of 942.00 from holding American Funds Growth or generate 52.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quantex Fund Retail vs. American Funds Growth
Performance |
| Timeline |
| Quantex Fund Retail |
| American Funds Growth |
Quantex Fund and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quantex Fund and American Funds
The main advantage of trading using opposite Quantex Fund and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quantex Fund position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Quantex Fund vs. American Funds Growth | Quantex Fund vs. American Funds Growth | Quantex Fund vs. Franklin Mutual Shares | Quantex Fund vs. Franklin Mutual Shares |
| American Funds vs. Rbc Global Equity | American Funds vs. Cutler Equity | American Funds vs. Us Vector Equity | American Funds vs. Ultra Short Fixed Income |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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