Correlation Between Aston Montag and Chase Growth
Can any of the company-specific risk be diversified away by investing in both Aston Montag and Chase 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 Aston Montag and Chase Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aston Montag Caldwell and Chase Growth Fund, you can compare the effects of market volatilities on Aston Montag and Chase 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 Aston Montag with a short position of Chase Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aston Montag and Chase Growth.
Diversification Opportunities for Aston Montag and Chase Growth
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aston and Chase is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Aston Montag Caldwell and Chase Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chase Growth and Aston Montag 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 Aston Montag Caldwell are associated (or correlated) with Chase Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chase Growth has no effect on the direction of Aston Montag i.e., Aston Montag and Chase Growth go up and down completely randomly.
Pair Corralation between Aston Montag and Chase Growth
Assuming the 90 days horizon Aston Montag Caldwell is expected to under-perform the Chase Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Aston Montag Caldwell is 1.5 times less risky than Chase Growth. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Chase Growth Fund is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,465 in Chase Growth Fund on November 7, 2024 and sell it today you would earn a total of 16.00 from holding Chase Growth Fund or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Aston Montag Caldwell vs. Chase Growth Fund
Performance |
| Timeline |
| Aston Montag Caldwell |
| Chase Growth |
Aston Montag and Chase Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aston Montag and Chase Growth
The main advantage of trading using opposite Aston Montag and Chase Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aston Montag position performs unexpectedly, Chase 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 Chase Growth will offset losses from the drop in Chase Growth's long position.| Aston Montag vs. Credit Suisse Modity | Aston Montag vs. Selected American Shares | Aston Montag vs. Causeway International Value | Aston Montag vs. Marsico Focus Fund |
| Chase Growth vs. The Chesapeake Growth | Chase Growth vs. Aston Montag Caldwell | Chase Growth vs. The Jensen Portfolio | Chase Growth vs. Cambiar Opportunity 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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