Correlation Between Federated Kaufmann and Largecap Growth
Can any of the company-specific risk be diversified away by investing in both Federated Kaufmann and Largecap Growth 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 Federated Kaufmann and Largecap Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Kaufmann Large and Largecap Growth Fund, you can compare the effects of market volatilities on Federated Kaufmann and Largecap Growth 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 Federated Kaufmann with a short position of Largecap Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Kaufmann and Largecap Growth.
Diversification Opportunities for Federated Kaufmann and Largecap Growth
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between FEDERATED and Largecap is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Federated Kaufmann Large and Largecap Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Largecap Growth and Federated Kaufmann 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 Federated Kaufmann Large are associated (or correlated) with Largecap Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Largecap Growth has no effect on the direction of Federated Kaufmann i.e., Federated Kaufmann and Largecap Growth go up and down completely randomly.
Pair Corralation between Federated Kaufmann and Largecap Growth
Assuming the 90 days horizon Federated Kaufmann Large is expected to generate 1.03 times more return on investment than Largecap Growth. However, Federated Kaufmann is 1.03 times more volatile than Largecap Growth Fund. It trades about 0.33 of its potential returns per unit of risk. Largecap Growth Fund is currently generating about 0.28 per unit of risk. If you would invest 1,880 in Federated Kaufmann Large on September 2, 2024 and sell it today you would earn a total of 119.00 from holding Federated Kaufmann Large or generate 6.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Kaufmann Large vs. Largecap Growth Fund
Performance |
| Timeline |
| Federated Kaufmann Large |
| Largecap Growth |
Federated Kaufmann and Largecap Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Kaufmann and Largecap Growth
The main advantage of trading using opposite Federated Kaufmann and Largecap Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Kaufmann position performs unexpectedly, Largecap Growth 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 Largecap Growth will offset losses from the drop in Largecap Growth's long position.| Federated Kaufmann vs. The National Tax Free | Federated Kaufmann vs. Federated Ohio Municipal | Federated Kaufmann vs. Gamco Global Telecommunications | Federated Kaufmann vs. T Rowe Price |
| Largecap Growth vs. Strategic Asset Management | Largecap Growth vs. Strategic Asset Management | Largecap Growth vs. Strategic Asset Management | Largecap Growth vs. Strategic Asset Management |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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