Correlation Between Fpa Crescent and Merger Fund
Can any of the company-specific risk be diversified away by investing in both Fpa Crescent and Merger Fund 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 Fpa Crescent and Merger Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fpa Crescent Fund and The Merger Fund, you can compare the effects of market volatilities on Fpa Crescent and Merger Fund 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 Fpa Crescent with a short position of Merger Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fpa Crescent and Merger Fund.
Diversification Opportunities for Fpa Crescent and Merger Fund
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fpa and Merger is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Fpa Crescent Fund and The Merger Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merger Fund and Fpa Crescent 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 Fpa Crescent Fund are associated (or correlated) with Merger Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merger Fund has no effect on the direction of Fpa Crescent i.e., Fpa Crescent and Merger Fund go up and down completely randomly.
Pair Corralation between Fpa Crescent and Merger Fund
Assuming the 90 days horizon Fpa Crescent Fund is expected to generate 3.51 times more return on investment than Merger Fund. However, Fpa Crescent is 3.51 times more volatile than The Merger Fund. It trades about 0.1 of its potential returns per unit of risk. The Merger Fund is currently generating about 0.1 per unit of risk. If you would invest 3,771 in Fpa Crescent Fund on September 14, 2024 and sell it today you would earn a total of 585.00 from holding Fpa Crescent Fund or generate 15.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fpa Crescent Fund vs. The Merger Fund
Performance |
| Timeline |
| Fpa Crescent |
| Merger Fund |
Fpa Crescent and Merger Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fpa Crescent and Merger Fund
The main advantage of trading using opposite Fpa Crescent and Merger Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fpa Crescent position performs unexpectedly, Merger Fund 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 Merger Fund will offset losses from the drop in Merger Fund's long position.| Fpa Crescent vs. Permanent Portfolio Class | Fpa Crescent vs. Amg Yacktman Fund | Fpa Crescent vs. Berwyn Income Fund | Fpa Crescent vs. First Eagle Global |
| Merger Fund vs. Strategic Advisers International | Merger Fund vs. Strategic Advisers Income | Merger Fund vs. Strategic Advisers E | Merger Fund vs. Strategic Advisers Emerging |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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