Correlation Between Kellner Merger and Rational Strategic
Can any of the company-specific risk be diversified away by investing in both Kellner Merger and Rational Strategic 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 Kellner Merger and Rational Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kellner Merger Fund and Rational Strategic Allocation, you can compare the effects of market volatilities on Kellner Merger and Rational Strategic 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 Kellner Merger with a short position of Rational Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kellner Merger and Rational Strategic.
Diversification Opportunities for Kellner Merger and Rational Strategic
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kellner and Rational is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kellner Merger Fund and Rational Strategic Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rational Strategic and Kellner Merger 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 Kellner Merger Fund are associated (or correlated) with Rational Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rational Strategic has no effect on the direction of Kellner Merger i.e., Kellner Merger and Rational Strategic go up and down completely randomly.
Pair Corralation between Kellner Merger and Rational Strategic
Assuming the 90 days horizon Kellner Merger Fund is expected to under-perform the Rational Strategic. But the mutual fund apears to be less risky and, when comparing its historical volatility, Kellner Merger Fund is 3.77 times less risky than Rational Strategic. The mutual fund trades about 0.0 of its potential returns per unit of risk. The Rational Strategic Allocation is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 754.00 in Rational Strategic Allocation on September 12, 2024 and sell it today you would earn a total of 199.00 from holding Rational Strategic Allocation or generate 26.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kellner Merger Fund vs. Rational Strategic Allocation
Performance |
| Timeline |
| Kellner Merger |
| Rational Strategic |
Kellner Merger and Rational Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kellner Merger and Rational Strategic
The main advantage of trading using opposite Kellner Merger and Rational Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kellner Merger position performs unexpectedly, Rational Strategic 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 Rational Strategic will offset losses from the drop in Rational Strategic's long position.| Kellner Merger vs. Rational Strategic Allocation | Kellner Merger vs. T Rowe Price | Kellner Merger vs. Jhancock Disciplined Value | Kellner Merger vs. Washington Mutual Investors |
| Rational Strategic vs. T Rowe Price | Rational Strategic vs. Qs Growth Fund | Rational Strategic vs. Balanced Fund Investor | Rational Strategic vs. Artisan Thematic Fund |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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