Correlation Between Balanced Fund and Polar Capital
Can any of the company-specific risk be diversified away by investing in both Balanced Fund and Polar Capital 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 Balanced Fund and Polar Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Balanced Fund Retail and Polar Capital Emerging, you can compare the effects of market volatilities on Balanced Fund and Polar Capital 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 Balanced Fund with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Fund and Polar Capital.
Diversification Opportunities for Balanced Fund and Polar Capital
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Balanced and Polar is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Fund Retail and Polar Capital Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Emerging and Balanced 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 Balanced Fund Retail are associated (or correlated) with Polar Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Capital Emerging has no effect on the direction of Balanced Fund i.e., Balanced Fund and Polar Capital go up and down completely randomly.
Pair Corralation between Balanced Fund and Polar Capital
Assuming the 90 days horizon Balanced Fund Retail is expected to generate 0.64 times more return on investment than Polar Capital. However, Balanced Fund Retail is 1.56 times less risky than Polar Capital. It trades about -0.02 of its potential returns per unit of risk. Polar Capital Emerging is currently generating about -0.05 per unit of risk. If you would invest 1,276 in Balanced Fund Retail on November 28, 2024 and sell it today you would lose (3.00) from holding Balanced Fund Retail or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Balanced Fund Retail vs. Polar Capital Emerging
Performance |
| Timeline |
| Balanced Fund Retail |
| Polar Capital Emerging |
Balanced Fund and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balanced Fund and Polar Capital
The main advantage of trading using opposite Balanced Fund and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balanced Fund position performs unexpectedly, Polar Capital 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 Polar Capital will offset losses from the drop in Polar Capital's long position.| Balanced Fund vs. Muirfield Fund Retail | Balanced Fund vs. Dynamic Growth Fund | Balanced Fund vs. Infrastructure Fund Retail | Balanced Fund vs. Quantex Fund Retail |
| Polar Capital vs. Polar Capital Emerging | Polar Capital vs. Calvert Short Duration | Polar Capital vs. Buffalo High Yield | Polar Capital vs. Blackrock Low Duration |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |