Correlation Between Nationwide Fund and General Money
Can any of the company-specific risk be diversified away by investing in both Nationwide Fund and General Money 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 Nationwide Fund and General Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Fund Class and General Money Market, you can compare the effects of market volatilities on Nationwide Fund and General Money 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 Nationwide Fund with a short position of General Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Fund and General Money.
Diversification Opportunities for Nationwide Fund and General Money
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nationwide and General is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Fund Class and General Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Money Market and Nationwide Fund 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 Nationwide Fund Class are associated (or correlated) with General Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Money Market has no effect on the direction of Nationwide Fund i.e., Nationwide Fund and General Money go up and down completely randomly.
Pair Corralation between Nationwide Fund and General Money
Assuming the 90 days horizon Nationwide Fund Class is expected to generate 3.6 times more return on investment than General Money. However, Nationwide Fund is 3.6 times more volatile than General Money Market. It trades about 0.09 of its potential returns per unit of risk. General Money Market is currently generating about 0.08 per unit of risk. If you would invest 2,788 in Nationwide Fund Class on September 12, 2024 and sell it today you would earn a total of 809.00 from holding Nationwide Fund Class or generate 29.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.6% |
| Values | Daily Returns |
Nationwide Fund Class vs. General Money Market
Performance |
| Timeline |
| Nationwide Fund Class |
| General Money Market |
Nationwide Fund and General Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Fund and General Money
The main advantage of trading using opposite Nationwide Fund and General Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Fund position performs unexpectedly, General Money 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 General Money will offset losses from the drop in General Money's long position.| Nationwide Fund vs. General Money Market | Nationwide Fund vs. Prudential Government Money | Nationwide Fund vs. Chestnut Street Exchange | Nationwide Fund vs. Edward Jones Money |
| General Money vs. T Rowe Price | General Money vs. Multisector Bond Sma | General Money vs. Ambrus Core Bond | General Money vs. Blrc Sgy Mnp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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