Correlation Between Needham Aggressive and Conestoga Mid
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Conestoga Mid 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 Needham Aggressive and Conestoga Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Conestoga Mid Cap, you can compare the effects of market volatilities on Needham Aggressive and Conestoga Mid 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 Needham Aggressive with a short position of Conestoga Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Conestoga Mid.
Diversification Opportunities for Needham Aggressive and Conestoga Mid
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Needham and Conestoga is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Conestoga Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conestoga Mid Cap and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Conestoga Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conestoga Mid Cap has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Conestoga Mid go up and down completely randomly.
Pair Corralation between Needham Aggressive and Conestoga Mid
Assuming the 90 days horizon Needham Aggressive Growth is expected to generate 1.51 times more return on investment than Conestoga Mid. However, Needham Aggressive is 1.51 times more volatile than Conestoga Mid Cap. It trades about 0.13 of its potential returns per unit of risk. Conestoga Mid Cap is currently generating about -0.03 per unit of risk. If you would invest 4,934 in Needham Aggressive Growth on September 13, 2024 and sell it today you would earn a total of 180.00 from holding Needham Aggressive Growth or generate 3.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Conestoga Mid Cap
Performance |
| Timeline |
| Needham Aggressive Growth |
| Conestoga Mid Cap |
Needham Aggressive and Conestoga Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Conestoga Mid
The main advantage of trading using opposite Needham Aggressive and Conestoga Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Conestoga Mid 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 Conestoga Mid will offset losses from the drop in Conestoga Mid's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
| Conestoga Mid vs. Strategic Advisers Income | Conestoga Mid vs. Guggenheim High Yield | Conestoga Mid vs. Jpmorgan High Yield | Conestoga Mid vs. Siit High Yield |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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