Correlation Between Aggressive Growth and Acrex
Can any of the company-specific risk be diversified away by investing in both Aggressive Growth and Acrex 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 Aggressive Growth and Acrex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aggressive Growth Portfolio and Acrex, you can compare the effects of market volatilities on Aggressive Growth and Acrex 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 Aggressive Growth with a short position of Acrex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aggressive Growth and Acrex.
Diversification Opportunities for Aggressive Growth and Acrex
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aggressive and Acrex is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Aggressive Growth Portfolio and Acrex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acrex and Aggressive Growth 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 Aggressive Growth Portfolio are associated (or correlated) with Acrex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acrex has no effect on the direction of Aggressive Growth i.e., Aggressive Growth and Acrex go up and down completely randomly.
Pair Corralation between Aggressive Growth and Acrex
Assuming the 90 days horizon Aggressive Growth Portfolio is expected to generate 1.05 times more return on investment than Acrex. However, Aggressive Growth is 1.05 times more volatile than Acrex. It trades about -0.1 of its potential returns per unit of risk. Acrex is currently generating about -0.29 per unit of risk. If you would invest 10,932 in Aggressive Growth Portfolio on September 28, 2024 and sell it today you would lose (399.00) from holding Aggressive Growth Portfolio or give up 3.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Aggressive Growth Portfolio vs. Acrex
Performance |
| Timeline |
| Aggressive Growth |
| Acrex |
Aggressive Growth and Acrex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aggressive Growth and Acrex
The main advantage of trading using opposite Aggressive Growth and Acrex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aggressive Growth position performs unexpectedly, Acrex 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 Acrex will offset losses from the drop in Acrex's long position.| Aggressive Growth vs. Versatile Bond Portfolio | Aggressive Growth vs. Short Term Treasury Portfolio | Aggressive Growth vs. Permanent Portfolio Class | Aggressive Growth vs. Dreyfus Balanced Opportunity |
| Acrex vs. Lord Abbett Small | Acrex vs. Fidelity Small Cap | Acrex vs. Applied Finance Explorer | Acrex vs. Heartland Value Plus |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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