Correlation Between Hodges Fund and Brown Advisory
Can any of the company-specific risk be diversified away by investing in both Hodges Fund and Brown Advisory 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 Hodges Fund and Brown Advisory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hodges Fund Retail and Brown Advisory Flexible, you can compare the effects of market volatilities on Hodges Fund and Brown Advisory 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 Hodges Fund with a short position of Brown Advisory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hodges Fund and Brown Advisory.
Diversification Opportunities for Hodges Fund and Brown Advisory
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hodges and Brown is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Hodges Fund Retail and Brown Advisory Flexible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brown Advisory Flexible and Hodges 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 Hodges Fund Retail are associated (or correlated) with Brown Advisory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brown Advisory Flexible has no effect on the direction of Hodges Fund i.e., Hodges Fund and Brown Advisory go up and down completely randomly.
Pair Corralation between Hodges Fund and Brown Advisory
Assuming the 90 days horizon Hodges Fund Retail is expected to generate 1.81 times more return on investment than Brown Advisory. However, Hodges Fund is 1.81 times more volatile than Brown Advisory Flexible. It trades about 0.09 of its potential returns per unit of risk. Brown Advisory Flexible is currently generating about 0.13 per unit of risk. If you would invest 5,159 in Hodges Fund Retail on August 31, 2024 and sell it today you would earn a total of 2,785 from holding Hodges Fund Retail or generate 53.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Hodges Fund Retail vs. Brown Advisory Flexible
Performance |
| Timeline |
| Hodges Fund Retail |
| Brown Advisory Flexible |
Hodges Fund and Brown Advisory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hodges Fund and Brown Advisory
The main advantage of trading using opposite Hodges Fund and Brown Advisory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hodges Fund position performs unexpectedly, Brown Advisory 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 Brown Advisory will offset losses from the drop in Brown Advisory's long position.| Hodges Fund vs. Marsico 21st Century | Hodges Fund vs. Kinetics Paradigm Fund | Hodges Fund vs. Royce Smaller Companies Growth | Hodges Fund vs. Polaris Global Value |
| Brown Advisory vs. Qs Large Cap | Brown Advisory vs. Enhanced Large Pany | Brown Advisory vs. Federated Kaufmann Large | Brown Advisory vs. Morningstar Unconstrained Allocation |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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