Correlation Between Needham Aggressive and Pro Blend
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Pro Blend 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 Pro Blend 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 Pro Blend Servative Term, you can compare the effects of market volatilities on Needham Aggressive and Pro Blend 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 Pro Blend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Pro Blend.
Diversification Opportunities for Needham Aggressive and Pro Blend
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Needham and Pro is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Pro Blend Servative Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pro Blend Servative 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 Pro Blend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pro Blend Servative has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Pro Blend go up and down completely randomly.
Pair Corralation between Needham Aggressive and Pro Blend
Assuming the 90 days horizon Needham Aggressive is expected to generate 1.22 times less return on investment than Pro Blend. In addition to that, Needham Aggressive is 6.3 times more volatile than Pro Blend Servative Term. It trades about 0.02 of its total potential returns per unit of risk. Pro Blend Servative Term is currently generating about 0.13 per unit of volatility. If you would invest 1,300 in Pro Blend Servative Term on September 13, 2024 and sell it today you would earn a total of 52.00 from holding Pro Blend Servative Term or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Pro Blend Servative Term
Performance |
| Timeline |
| Needham Aggressive Growth |
| Pro Blend Servative |
Needham Aggressive and Pro Blend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Pro Blend
The main advantage of trading using opposite Needham Aggressive and Pro Blend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Pro Blend 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 Pro Blend will offset losses from the drop in Pro Blend'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 |
| Pro Blend vs. Manning Napier Callodine | Pro Blend vs. Manning Napier Callodine | Pro Blend vs. Manning Napier Callodine | Pro Blend vs. Pro Blend Extended Term |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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