Correlation Between Pacific Funds and Cref Money
Can any of the company-specific risk be diversified away by investing in both Pacific Funds and Cref 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 Pacific Funds and Cref Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacific Funds Small Cap and Cref Money Market, you can compare the effects of market volatilities on Pacific Funds and Cref 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 Pacific Funds with a short position of Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacific Funds and Cref Money.
Diversification Opportunities for Pacific Funds and Cref Money
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pacific and Cref is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Pacific Funds Small Cap and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market 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 Small Cap are associated (or correlated) with Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of Pacific Funds i.e., Pacific Funds and Cref Money go up and down completely randomly.
Pair Corralation between Pacific Funds and Cref Money
Assuming the 90 days horizon Pacific Funds Small Cap is expected to under-perform the Cref Money. In addition to that, Pacific Funds is 43.38 times more volatile than Cref Money Market. It trades about -0.02 of its total potential returns per unit of risk. Cref Money Market is currently generating about 0.79 per unit of volatility. If you would invest 2,695 in Cref Money Market on August 24, 2024 and sell it today you would earn a total of 274.00 from holding Cref Money Market or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 23.86% |
| Values | Daily Returns |
Pacific Funds Small Cap vs. Cref Money Market
Performance |
| Timeline |
| Pacific Funds Small |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cref Money Market |
Pacific Funds and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pacific Funds and Cref Money
The main advantage of trading using opposite Pacific Funds and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacific Funds position performs unexpectedly, Cref 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 Cref Money will offset losses from the drop in Cref Money's long position.| Pacific Funds vs. Praxis Growth Index | Pacific Funds vs. Growth Fund Of | Pacific Funds vs. Artisan Small Cap | Pacific Funds vs. Qs Growth Fund |
| Cref Money vs. Government Securities Fund | Cref Money vs. Invesco Government Fund | Cref Money vs. Blackrock Government Bond | Cref Money vs. Us Government Securities |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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