Correlation Between Balanced Fund and Clearbridge Aggressive
Can any of the company-specific risk be diversified away by investing in both Balanced Fund and Clearbridge 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 Balanced Fund and Clearbridge Aggressive 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 Clearbridge Aggressive Growth, you can compare the effects of market volatilities on Balanced Fund and Clearbridge 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 Balanced Fund with a short position of Clearbridge Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Fund and Clearbridge Aggressive.
Diversification Opportunities for Balanced Fund and Clearbridge Aggressive
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Balanced and Clearbridge is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Fund Retail and Clearbridge Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Aggressive 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 Clearbridge Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Aggressive has no effect on the direction of Balanced Fund i.e., Balanced Fund and Clearbridge Aggressive go up and down completely randomly.
Pair Corralation between Balanced Fund and Clearbridge Aggressive
Assuming the 90 days horizon Balanced Fund Retail is expected to generate 0.05 times more return on investment than Clearbridge Aggressive. However, Balanced Fund Retail is 20.68 times less risky than Clearbridge Aggressive. It trades about 0.1 of its potential returns per unit of risk. Clearbridge Aggressive Growth is currently generating about -0.21 per unit of risk. If you would invest 1,438 in Balanced Fund Retail on September 14, 2024 and sell it today you would earn a total of 12.00 from holding Balanced Fund Retail or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Balanced Fund Retail vs. Clearbridge Aggressive Growth
Performance |
| Timeline |
| Balanced Fund Retail |
| Clearbridge Aggressive |
Balanced Fund and Clearbridge Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balanced Fund and Clearbridge Aggressive
The main advantage of trading using opposite Balanced Fund and Clearbridge Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balanced Fund position performs unexpectedly, Clearbridge 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 Clearbridge Aggressive will offset losses from the drop in Clearbridge Aggressive'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 |
| Clearbridge Aggressive vs. Old Westbury Municipal | Clearbridge Aggressive vs. T Rowe Price | Clearbridge Aggressive vs. The National Tax Free | Clearbridge Aggressive vs. Ishares Municipal Bond |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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