Correlation Between Jensen Portfolio and Clipper Fund
Can any of the company-specific risk be diversified away by investing in both Jensen Portfolio and Clipper 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 Jensen Portfolio and Clipper Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Jensen Portfolio and Clipper Fund Inc, you can compare the effects of market volatilities on Jensen Portfolio and Clipper 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 Jensen Portfolio with a short position of Clipper Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jensen Portfolio and Clipper Fund.
Diversification Opportunities for Jensen Portfolio and Clipper Fund
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jensen and Clipper is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding The Jensen Portfolio and Clipper Fund Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clipper Fund and Jensen Portfolio 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 The Jensen Portfolio are associated (or correlated) with Clipper Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clipper Fund has no effect on the direction of Jensen Portfolio i.e., Jensen Portfolio and Clipper Fund go up and down completely randomly.
Pair Corralation between Jensen Portfolio and Clipper Fund
Assuming the 90 days horizon Jensen Portfolio is expected to generate 14.57 times less return on investment than Clipper Fund. In addition to that, Jensen Portfolio is 1.2 times more volatile than Clipper Fund Inc. It trades about 0.01 of its total potential returns per unit of risk. Clipper Fund Inc is currently generating about 0.1 per unit of volatility. If you would invest 15,319 in Clipper Fund Inc on September 13, 2024 and sell it today you would earn a total of 138.00 from holding Clipper Fund Inc or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Jensen Portfolio vs. Clipper Fund Inc
Performance |
| Timeline |
| Jensen Portfolio |
| Clipper Fund |
Jensen Portfolio and Clipper Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jensen Portfolio and Clipper Fund
The main advantage of trading using opposite Jensen Portfolio and Clipper Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jensen Portfolio position performs unexpectedly, Clipper 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 Clipper Fund will offset losses from the drop in Clipper Fund's long position.| Jensen Portfolio vs. Clipper Fund Inc | Jensen Portfolio vs. Parnassus E Equity | Jensen Portfolio vs. Mairs Power Growth | Jensen Portfolio vs. Sound Shore Fund |
| Clipper Fund vs. Value Fund Value | Clipper Fund vs. Meridian Trarian Fund | Clipper Fund vs. Longleaf Partners Fund | Clipper Fund vs. Mairs Power Growth |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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