Correlation Between New Perspective and Mirova Global
Can any of the company-specific risk be diversified away by investing in both New Perspective and Mirova Global 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 New Perspective and Mirova Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Perspective Fund and Mirova Global Sustainable, you can compare the effects of market volatilities on New Perspective and Mirova Global 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 New Perspective with a short position of Mirova Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Perspective and Mirova Global.
Diversification Opportunities for New Perspective and Mirova Global
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between New and Mirova is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding New Perspective Fund and Mirova Global Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirova Global Sustainable and New Perspective 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 New Perspective Fund are associated (or correlated) with Mirova Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirova Global Sustainable has no effect on the direction of New Perspective i.e., New Perspective and Mirova Global go up and down completely randomly.
Pair Corralation between New Perspective and Mirova Global
Assuming the 90 days horizon New Perspective is expected to generate 1.12 times less return on investment than Mirova Global. In addition to that, New Perspective is 1.02 times more volatile than Mirova Global Sustainable. It trades about 0.08 of its total potential returns per unit of risk. Mirova Global Sustainable is currently generating about 0.09 per unit of volatility. If you would invest 1,681 in Mirova Global Sustainable on September 12, 2024 and sell it today you would earn a total of 445.00 from holding Mirova Global Sustainable or generate 26.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Perspective Fund vs. Mirova Global Sustainable
Performance |
| Timeline |
| New Perspective |
| Mirova Global Sustainable |
New Perspective and Mirova Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Perspective and Mirova Global
The main advantage of trading using opposite New Perspective and Mirova Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Perspective position performs unexpectedly, Mirova Global 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 Mirova Global will offset losses from the drop in Mirova Global's long position.| New Perspective vs. Pace Municipal Fixed | New Perspective vs. Transamerica Intermediate Muni | New Perspective vs. Counterpoint Tactical Municipal | New Perspective vs. The National Tax Free |
| Mirova Global vs. American Funds New | Mirova Global vs. American Funds New | Mirova Global vs. New Perspective Fund | Mirova Global vs. New Perspective 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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