Correlation Between Nationwide Highmark and Fam Value
Can any of the company-specific risk be diversified away by investing in both Nationwide Highmark and Fam Value 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 Highmark and Fam Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Highmark Small and Fam Value Fund, you can compare the effects of market volatilities on Nationwide Highmark and Fam Value 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 Highmark with a short position of Fam Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Highmark and Fam Value.
Diversification Opportunities for Nationwide Highmark and Fam Value
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nationwide and Fam is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Highmark Small and Fam Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fam Value Fund and Nationwide Highmark 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 Highmark Small are associated (or correlated) with Fam Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fam Value Fund has no effect on the direction of Nationwide Highmark i.e., Nationwide Highmark and Fam Value go up and down completely randomly.
Pair Corralation between Nationwide Highmark and Fam Value
Assuming the 90 days horizon Nationwide Highmark is expected to generate 1.32 times less return on investment than Fam Value. In addition to that, Nationwide Highmark is 1.38 times more volatile than Fam Value Fund. It trades about 0.08 of its total potential returns per unit of risk. Fam Value Fund is currently generating about 0.14 per unit of volatility. If you would invest 9,734 in Fam Value Fund on September 1, 2024 and sell it today you would earn a total of 1,597 from holding Fam Value Fund or generate 16.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Nationwide Highmark Small vs. Fam Value Fund
Performance |
| Timeline |
| Nationwide Highmark Small |
| Fam Value Fund |
Nationwide Highmark and Fam Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Highmark and Fam Value
The main advantage of trading using opposite Nationwide Highmark and Fam Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Highmark position performs unexpectedly, Fam Value 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 Fam Value will offset losses from the drop in Fam Value's long position.| Nationwide Highmark vs. Nationwide Highmark Small | Nationwide Highmark vs. Janus Venture Fund | Nationwide Highmark vs. The Hartford Midcap |
| Fam Value vs. Simt Managed Volatility | Fam Value vs. Hartford Schroders Smallmid | Fam Value vs. Virtus Kar Mid Cap | Fam Value vs. Hennessy Focus 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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