Correlation Between Shelton Funds and Foreign Bond
Can any of the company-specific risk be diversified away by investing in both Shelton Funds and Foreign Bond 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 Shelton Funds and Foreign Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shelton Funds and Foreign Bond Fund, you can compare the effects of market volatilities on Shelton Funds and Foreign Bond 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 Shelton Funds with a short position of Foreign Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Funds and Foreign Bond.
Diversification Opportunities for Shelton Funds and Foreign Bond
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shelton and Foreign is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Funds and Foreign Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foreign Bond and Shelton Funds 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 Shelton Funds are associated (or correlated) with Foreign Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foreign Bond has no effect on the direction of Shelton Funds i.e., Shelton Funds and Foreign Bond go up and down completely randomly.
Pair Corralation between Shelton Funds and Foreign Bond
Assuming the 90 days horizon Shelton Funds is expected to generate 2.93 times more return on investment than Foreign Bond. However, Shelton Funds is 2.93 times more volatile than Foreign Bond Fund. It trades about 0.09 of its potential returns per unit of risk. Foreign Bond Fund is currently generating about 0.14 per unit of risk. If you would invest 3,898 in Shelton Funds on November 3, 2024 and sell it today you would earn a total of 93.00 from holding Shelton Funds or generate 2.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shelton Funds vs. Foreign Bond Fund
Performance |
| Timeline |
| Shelton Funds |
| Foreign Bond |
Shelton Funds and Foreign Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Funds and Foreign Bond
The main advantage of trading using opposite Shelton Funds and Foreign Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Funds position performs unexpectedly, Foreign Bond 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 Foreign Bond will offset losses from the drop in Foreign Bond's long position.| Shelton Funds vs. Us Vector Equity | Shelton Funds vs. Smallcap World Fund | Shelton Funds vs. The Growth Equity | Shelton Funds vs. Small Cap Equity |
| Foreign Bond vs. Pimco Rae Worldwide | Foreign Bond vs. Pimco Realestaterealreturn Strategy | Foreign Bond vs. Pimco Rae Worldwide | Foreign Bond vs. Pimco Rae Worldwide |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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