Correlation Between Pacific Funds and Profunds-large Cap
Can any of the company-specific risk be diversified away by investing in both Pacific Funds and Profunds-large Cap 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 Pacific Funds and Profunds-large Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacific Funds Smallmid Cap and Profunds Large Cap Growth, you can compare the effects of market volatilities on Pacific Funds and Profunds-large Cap 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 Pacific Funds with a short position of Profunds-large Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacific Funds and Profunds-large Cap.
Diversification Opportunities for Pacific Funds and Profunds-large Cap
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pacific and ProFunds-Large is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Pacific Funds Smallmid Cap and Profunds Large Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profunds Large Cap and Pacific 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 Pacific Funds Smallmid Cap are associated (or correlated) with Profunds-large Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profunds Large Cap has no effect on the direction of Pacific Funds i.e., Pacific Funds and Profunds-large Cap go up and down completely randomly.
Pair Corralation between Pacific Funds and Profunds-large Cap
If you would invest 3,517 in Profunds Large Cap Growth on November 2, 2024 and sell it today you would earn a total of 103.00 from holding Profunds Large Cap Growth or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Pacific Funds Smallmid Cap vs. Profunds Large Cap Growth
Performance |
| Timeline |
| Pacific Funds Smallmid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Profunds Large Cap |
Pacific Funds and Profunds-large Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pacific Funds and Profunds-large Cap
The main advantage of trading using opposite Pacific Funds and Profunds-large Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacific Funds position performs unexpectedly, Profunds-large Cap 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 Profunds-large Cap will offset losses from the drop in Profunds-large Cap's long position.| Pacific Funds vs. Lord Abbett Convertible | Pacific Funds vs. Advent Claymore Convertible | Pacific Funds vs. Virtus Convertible | Pacific Funds vs. Putnam Convertible Securities |
| Profunds-large Cap vs. Hennessy Large Cap | Profunds-large Cap vs. T Rowe Price | Profunds-large Cap vs. Angel Oak Financial | Profunds-large Cap vs. Gabelli Global Financial |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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