Correlation Between Frontier Mfg and Alger Mid
Can any of the company-specific risk be diversified away by investing in both Frontier Mfg and Alger Mid 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 Frontier Mfg and Alger Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frontier Mfg Global and Alger Mid Cap, you can compare the effects of market volatilities on Frontier Mfg and Alger Mid 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 Frontier Mfg with a short position of Alger Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frontier Mfg and Alger Mid.
Diversification Opportunities for Frontier Mfg and Alger Mid
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Frontier and Alger is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Frontier Mfg Global and Alger Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Mid Cap and Frontier Mfg 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 Frontier Mfg Global are associated (or correlated) with Alger Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Mid Cap has no effect on the direction of Frontier Mfg i.e., Frontier Mfg and Alger Mid go up and down completely randomly.
Pair Corralation between Frontier Mfg and Alger Mid
Assuming the 90 days horizon Frontier Mfg Global is expected to generate 0.65 times more return on investment than Alger Mid. However, Frontier Mfg Global is 1.55 times less risky than Alger Mid. It trades about 0.12 of its potential returns per unit of risk. Alger Mid Cap is currently generating about 0.08 per unit of risk. If you would invest 1,037 in Frontier Mfg Global on September 3, 2024 and sell it today you would earn a total of 522.00 from holding Frontier Mfg Global or generate 50.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Frontier Mfg Global vs. Alger Mid Cap
Performance |
| Timeline |
| Frontier Mfg Global |
| Alger Mid Cap |
Frontier Mfg and Alger Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frontier Mfg and Alger Mid
The main advantage of trading using opposite Frontier Mfg and Alger Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frontier Mfg position performs unexpectedly, Alger Mid 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 Alger Mid will offset losses from the drop in Alger Mid's long position.| Frontier Mfg vs. Astor Longshort Fund | Frontier Mfg vs. Barings Active Short | Frontier Mfg vs. Rbc Short Duration | Frontier Mfg vs. Calvert Short Duration |
| Alger Mid vs. Cs 607 Tax | Alger Mid vs. Franklin High Yield | Alger Mid vs. T Rowe Price | Alger Mid vs. Intermediate Term Tax Free 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |