Correlation Between Needham Small and Elfun Government
Can any of the company-specific risk be diversified away by investing in both Needham Small and Elfun Government 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 Small and Elfun Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Small Cap and Elfun Government Money, you can compare the effects of market volatilities on Needham Small and Elfun Government 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 Small with a short position of Elfun Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Small and Elfun Government.
Diversification Opportunities for Needham Small and Elfun Government
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Needham and Elfun is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Needham Small Cap and Elfun Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elfun Government Money and Needham Small 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 Small Cap are associated (or correlated) with Elfun Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elfun Government Money has no effect on the direction of Needham Small i.e., Needham Small and Elfun Government go up and down completely randomly.
Pair Corralation between Needham Small and Elfun Government
If you would invest 100.00 in Elfun Government Money on October 10, 2024 and sell it today you would earn a total of 0.00 from holding Elfun Government Money or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Small Cap vs. Elfun Government Money
Performance |
| Timeline |
| Needham Small Cap |
| Elfun Government Money |
Needham Small and Elfun Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Small and Elfun Government
The main advantage of trading using opposite Needham Small and Elfun Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Small position performs unexpectedly, Elfun Government 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 Elfun Government will offset losses from the drop in Elfun Government's long position.| Needham Small vs. Needham Aggressive Growth | Needham Small vs. Needham Growth Fund | Needham Small vs. Baron Opportunity Fund | Needham Small vs. Jacob Micro Cap |
| Elfun Government vs. Inverse Government Long | Elfun Government vs. Intermediate Government Bond | Elfun Government vs. Ridgeworth Seix Government | Elfun Government vs. Short Term Government 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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