Correlation Between Hennessy Focus and Amg Yacktman
Can any of the company-specific risk be diversified away by investing in both Hennessy Focus and Amg Yacktman 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 Hennessy Focus and Amg Yacktman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hennessy Focus Fund and Amg Yacktman Focused, you can compare the effects of market volatilities on Hennessy Focus and Amg Yacktman 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 Hennessy Focus with a short position of Amg Yacktman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hennessy Focus and Amg Yacktman.
Diversification Opportunities for Hennessy Focus and Amg Yacktman
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hennessy and Amg is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Hennessy Focus Fund and Amg Yacktman Focused in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Yacktman Focused and Hennessy Focus 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 Hennessy Focus Fund are associated (or correlated) with Amg Yacktman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Yacktman Focused has no effect on the direction of Hennessy Focus i.e., Hennessy Focus and Amg Yacktman go up and down completely randomly.
Pair Corralation between Hennessy Focus and Amg Yacktman
Assuming the 90 days horizon Hennessy Focus Fund is expected to generate 2.21 times more return on investment than Amg Yacktman. However, Hennessy Focus is 2.21 times more volatile than Amg Yacktman Focused. It trades about 0.03 of its potential returns per unit of risk. Amg Yacktman Focused is currently generating about -0.07 per unit of risk. If you would invest 5,208 in Hennessy Focus Fund on August 25, 2024 and sell it today you would earn a total of 68.00 from holding Hennessy Focus Fund or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hennessy Focus Fund vs. Amg Yacktman Focused
Performance |
| Timeline |
| Hennessy Focus |
| Amg Yacktman Focused |
Hennessy Focus and Amg Yacktman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hennessy Focus and Amg Yacktman
The main advantage of trading using opposite Hennessy Focus and Amg Yacktman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hennessy Focus position performs unexpectedly, Amg Yacktman 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 Amg Yacktman will offset losses from the drop in Amg Yacktman's long position.| Hennessy Focus vs. Hennessy Nerstone Mid | Hennessy Focus vs. Amg Yacktman Focused | Hennessy Focus vs. Parnassus Endeavor Fund | Hennessy Focus vs. Hennessy Small Cap |
| Amg Yacktman vs. Amg Yacktman Fund | Amg Yacktman vs. Permanent Portfolio Class | Amg Yacktman vs. Oakmark International Fund | Amg Yacktman vs. Intrepid Endurance 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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