Correlation Between Hodges Fund and Hodges Blue
Can any of the company-specific risk be diversified away by investing in both Hodges Fund and Hodges Blue 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 Hodges Blue 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 Hodges Blue Chip, you can compare the effects of market volatilities on Hodges Fund and Hodges Blue 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 Hodges Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hodges Fund and Hodges Blue.
Diversification Opportunities for Hodges Fund and Hodges Blue
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hodges and Hodges is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Hodges Fund Retail and Hodges Blue Chip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hodges Blue Chip 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 Hodges Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hodges Blue Chip has no effect on the direction of Hodges Fund i.e., Hodges Fund and Hodges Blue go up and down completely randomly.
Pair Corralation between Hodges Fund and Hodges Blue
Assuming the 90 days horizon Hodges Fund Retail is expected to generate 1.79 times more return on investment than Hodges Blue. However, Hodges Fund is 1.79 times more volatile than Hodges Blue Chip. It trades about 0.12 of its potential returns per unit of risk. Hodges Blue Chip is currently generating about 0.16 per unit of risk. If you would invest 6,387 in Hodges Fund Retail on August 28, 2024 and sell it today you would earn a total of 1,556 from holding Hodges Fund Retail or generate 24.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Hodges Fund Retail vs. Hodges Blue Chip
Performance |
| Timeline |
| Hodges Fund Retail |
| Hodges Blue Chip |
Hodges Fund and Hodges Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hodges Fund and Hodges Blue
The main advantage of trading using opposite Hodges Fund and Hodges Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hodges Fund position performs unexpectedly, Hodges Blue 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 Hodges Blue will offset losses from the drop in Hodges Blue'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. Wasatch Large Cap |
| Hodges Blue vs. Hodges Small Cap | Hodges Blue vs. Hodges Fund Retail | Hodges Blue vs. Hodges Small Intrinsic | Hodges Blue vs. Brown Advisory Flexible |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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