Correlation Between Mirova Global and Growth Strategy
Can any of the company-specific risk be diversified away by investing in both Mirova Global and Growth Strategy 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 Mirova Global and Growth Strategy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirova Global Green and Growth Strategy Fund, you can compare the effects of market volatilities on Mirova Global and Growth Strategy 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 Mirova Global with a short position of Growth Strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirova Global and Growth Strategy.
Diversification Opportunities for Mirova Global and Growth Strategy
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mirova and Growth is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Mirova Global Green and Growth Strategy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Strategy and Mirova Global 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 Mirova Global Green are associated (or correlated) with Growth Strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Strategy has no effect on the direction of Mirova Global i.e., Mirova Global and Growth Strategy go up and down completely randomly.
Pair Corralation between Mirova Global and Growth Strategy
Assuming the 90 days horizon Mirova Global is expected to generate 2.59 times less return on investment than Growth Strategy. But when comparing it to its historical volatility, Mirova Global Green is 2.25 times less risky than Growth Strategy. It trades about 0.09 of its potential returns per unit of risk. Growth Strategy Fund is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,195 in Growth Strategy Fund on September 1, 2024 and sell it today you would earn a total of 146.00 from holding Growth Strategy Fund or generate 12.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Mirova Global Green vs. Growth Strategy Fund
Performance |
| Timeline |
| Mirova Global Green |
| Growth Strategy |
Mirova Global and Growth Strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirova Global and Growth Strategy
The main advantage of trading using opposite Mirova Global and Growth Strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirova Global position performs unexpectedly, Growth Strategy 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 Strategy will offset losses from the drop in Growth Strategy's long position.| Mirova Global vs. Bbh Partner Fund | Mirova Global vs. Scharf Global Opportunity | Mirova Global vs. T Rowe Price | Mirova Global vs. Volumetric Fund Volumetric |
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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