Correlation Between Meeder Funds and American Funds
Can any of the company-specific risk be diversified away by investing in both Meeder Funds 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 Meeder Funds and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meeder Funds and American Funds Smallcap, you can compare the effects of market volatilities on Meeder Funds 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 Meeder Funds with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meeder Funds and American Funds.
Diversification Opportunities for Meeder Funds and American Funds
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Meeder and American is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Meeder Funds and American Funds Smallcap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds Smallcap and Meeder 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 Meeder Funds 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 Smallcap has no effect on the direction of Meeder Funds i.e., Meeder Funds and American Funds go up and down completely randomly.
Pair Corralation between Meeder Funds and American Funds
If you would invest 6,931 in American Funds Smallcap on September 3, 2024 and sell it today you would earn a total of 283.00 from holding American Funds Smallcap or generate 4.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meeder Funds vs. American Funds Smallcap
Performance |
| Timeline |
| Meeder Funds |
| American Funds Smallcap |
Meeder Funds and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meeder Funds and American Funds
The main advantage of trading using opposite Meeder Funds and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meeder Funds 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.| Meeder Funds vs. Simt Real Estate | Meeder Funds vs. Columbia Real Estate | Meeder Funds vs. Goldman Sachs Real | Meeder Funds vs. Fidelity Real Estate |
| American Funds vs. T Rowe Price | American Funds vs. Northern Small Cap | American Funds vs. Jhancock Diversified Macro | American Funds vs. Delaware Limited Term Diversified |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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