Correlation Between Edward Jones and American Funds
Can any of the company-specific risk be diversified away by investing in both Edward Jones and American Funds 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 Edward Jones and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edward Jones Money and American Funds 2020, you can compare the effects of market volatilities on Edward Jones and American Funds 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 Edward Jones with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edward Jones and American Funds.
Diversification Opportunities for Edward Jones and American Funds
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Edward and American is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Edward Jones Money and American Funds 2020 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds 2020 and Edward Jones 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 Edward Jones Money are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds 2020 has no effect on the direction of Edward Jones i.e., Edward Jones and American Funds go up and down completely randomly.
Pair Corralation between Edward Jones and American Funds
Assuming the 90 days horizon Edward Jones Money is expected to generate 39.38 times more return on investment than American Funds. However, Edward Jones is 39.38 times more volatile than American Funds 2020. It trades about 0.03 of its potential returns per unit of risk. American Funds 2020 is currently generating about 0.09 per unit of risk. If you would invest 95.00 in Edward Jones Money on September 13, 2024 and sell it today you would earn a total of 5.00 from holding Edward Jones Money or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.0% |
| Values | Daily Returns |
Edward Jones Money vs. American Funds 2020
Performance |
| Timeline |
| Edward Jones Money |
| American Funds 2020 |
Edward Jones and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edward Jones and American Funds
The main advantage of trading using opposite Edward Jones and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edward Jones position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Edward Jones vs. Heartland Value Plus | Edward Jones vs. Great West Loomis Sayles | Edward Jones vs. Ab Discovery Value | Edward Jones vs. Royce Opportunity Fund |
| American Funds vs. Edward Jones Money | American Funds vs. Blackrock Exchange Portfolio | American Funds vs. Hewitt Money Market | American Funds vs. Hsbc Treasury Money |
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 .
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