Correlation Between James Alpha and Growth Fund
Can any of the company-specific risk be diversified away by investing in both James Alpha and Growth Fund 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 James Alpha and Growth Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between James Alpha Global and Growth Fund Of, you can compare the effects of market volatilities on James Alpha and Growth Fund 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 James Alpha with a short position of Growth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of James Alpha and Growth Fund.
Diversification Opportunities for James Alpha and Growth Fund
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between James and Growth is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding James Alpha Global and Growth Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Fund and James Alpha 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 James Alpha Global are associated (or correlated) with Growth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Fund has no effect on the direction of James Alpha i.e., James Alpha and Growth Fund go up and down completely randomly.
Pair Corralation between James Alpha and Growth Fund
Assuming the 90 days horizon James Alpha Global is expected to generate 0.8 times more return on investment than Growth Fund. However, James Alpha Global is 1.25 times less risky than Growth Fund. It trades about 0.05 of its potential returns per unit of risk. Growth Fund Of is currently generating about -0.13 per unit of risk. If you would invest 1,488 in James Alpha Global on November 28, 2024 and sell it today you would earn a total of 11.00 from holding James Alpha Global or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
James Alpha Global vs. Growth Fund Of
Performance |
| Timeline |
| James Alpha Global |
| Growth Fund |
James Alpha and Growth Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with James Alpha and Growth Fund
The main advantage of trading using opposite James Alpha and Growth Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if James Alpha position performs unexpectedly, Growth Fund 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 Growth Fund will offset losses from the drop in Growth Fund's long position.| James Alpha vs. Goldman Sachs Small | James Alpha vs. Touchstone Small Cap | James Alpha vs. Ab Small Cap | James Alpha vs. United Kingdom Small |
| Growth Fund vs. Europacific Growth Fund | Growth Fund vs. Capital World Growth | Growth Fund vs. Smallcap World Fund | Growth Fund vs. American Balanced 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |