Correlation Between Intrepid Endurance and Needham Aggressive
Can any of the company-specific risk be diversified away by investing in both Intrepid Endurance and Needham Aggressive 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 Intrepid Endurance and Needham Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intrepid Endurance Fund and Needham Aggressive Growth, you can compare the effects of market volatilities on Intrepid Endurance and Needham Aggressive 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 Intrepid Endurance with a short position of Needham Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intrepid Endurance and Needham Aggressive.
Diversification Opportunities for Intrepid Endurance and Needham Aggressive
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Intrepid and Needham is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Intrepid Endurance Fund and Needham Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Needham Aggressive Growth and Intrepid Endurance 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 Intrepid Endurance Fund are associated (or correlated) with Needham Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Needham Aggressive Growth has no effect on the direction of Intrepid Endurance i.e., Intrepid Endurance and Needham Aggressive go up and down completely randomly.
Pair Corralation between Intrepid Endurance and Needham Aggressive
Assuming the 90 days horizon Intrepid Endurance is expected to generate 2.11 times less return on investment than Needham Aggressive. But when comparing it to its historical volatility, Intrepid Endurance Fund is 1.42 times less risky than Needham Aggressive. It trades about 0.05 of its potential returns per unit of risk. Needham Aggressive Growth is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,707 in Needham Aggressive Growth on August 26, 2024 and sell it today you would earn a total of 1,009 from holding Needham Aggressive Growth or generate 27.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intrepid Endurance Fund vs. Needham Aggressive Growth
Performance |
| Timeline |
| Intrepid Endurance |
| Needham Aggressive Growth |
Intrepid Endurance and Needham Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intrepid Endurance and Needham Aggressive
The main advantage of trading using opposite Intrepid Endurance and Needham Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intrepid Endurance position performs unexpectedly, Needham Aggressive 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 Needham Aggressive will offset losses from the drop in Needham Aggressive's long position.| Intrepid Endurance vs. Amg Yacktman Focused | Intrepid Endurance vs. Intrepid Capital Fund | Intrepid Endurance vs. Heartland Value Plus | Intrepid Endurance vs. Appleseed Fund Appleseed |
| Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Needham Growth Fund | Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Oberweis Micro Cap 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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