Correlation Between Muhlenkamp Fund and Third Avenue
Can any of the company-specific risk be diversified away by investing in both Muhlenkamp Fund and Third Avenue 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 Muhlenkamp Fund and Third Avenue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Muhlenkamp Fund Institutional and Third Avenue Value, you can compare the effects of market volatilities on Muhlenkamp Fund and Third Avenue 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 Muhlenkamp Fund with a short position of Third Avenue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Muhlenkamp Fund and Third Avenue.
Diversification Opportunities for Muhlenkamp Fund and Third Avenue
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Muhlenkamp and Third is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Muhlenkamp Fund Institutional and Third Avenue Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Third Avenue Value and Muhlenkamp Fund 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 Muhlenkamp Fund Institutional are associated (or correlated) with Third Avenue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Third Avenue Value has no effect on the direction of Muhlenkamp Fund i.e., Muhlenkamp Fund and Third Avenue go up and down completely randomly.
Pair Corralation between Muhlenkamp Fund and Third Avenue
Assuming the 90 days horizon Muhlenkamp Fund Institutional is expected to under-perform the Third Avenue. In addition to that, Muhlenkamp Fund is 2.68 times more volatile than Third Avenue Value. It trades about -0.04 of its total potential returns per unit of risk. Third Avenue Value is currently generating about 0.14 per unit of volatility. If you would invest 5,743 in Third Avenue Value on October 23, 2024 and sell it today you would earn a total of 101.00 from holding Third Avenue Value or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Muhlenkamp Fund Institutional vs. Third Avenue Value
Performance |
| Timeline |
| Muhlenkamp Fund Inst |
| Third Avenue Value |
Muhlenkamp Fund and Third Avenue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Muhlenkamp Fund and Third Avenue
The main advantage of trading using opposite Muhlenkamp Fund and Third Avenue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Muhlenkamp Fund position performs unexpectedly, Third Avenue 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 Third Avenue will offset losses from the drop in Third Avenue's long position.| Muhlenkamp Fund vs. Third Avenue Value | Muhlenkamp Fund vs. Meridian Growth Fund | Muhlenkamp Fund vs. Heartland Value Fund | Muhlenkamp Fund vs. Mairs Power Growth |
| Third Avenue vs. Center St Mlp | Third Avenue vs. Qs Large Cap | Third Avenue vs. Fpddjx | Third Avenue vs. Fa 529 Aggressive |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |