Correlation Between Growth Fund and Federated Hermes
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Federated Hermes 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 Growth Fund and Federated Hermes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Of and Federated Hermes Inflation, you can compare the effects of market volatilities on Growth Fund and Federated Hermes 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 Growth Fund with a short position of Federated Hermes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Federated Hermes.
Diversification Opportunities for Growth Fund and Federated Hermes
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Growth and Federated is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Federated Hermes Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Hermes Inf and Growth 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 Growth Fund Of are associated (or correlated) with Federated Hermes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Hermes Inf has no effect on the direction of Growth Fund i.e., Growth Fund and Federated Hermes go up and down completely randomly.
Pair Corralation between Growth Fund and Federated Hermes
Assuming the 90 days horizon Growth Fund Of is expected to generate 3.01 times more return on investment than Federated Hermes. However, Growth Fund is 3.01 times more volatile than Federated Hermes Inflation. It trades about 0.09 of its potential returns per unit of risk. Federated Hermes Inflation is currently generating about 0.13 per unit of risk. If you would invest 8,142 in Growth Fund Of on September 12, 2024 and sell it today you would earn a total of 99.00 from holding Growth Fund Of or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Fund Of vs. Federated Hermes Inflation
Performance |
| Timeline |
| Growth Fund |
| Federated Hermes Inf |
Growth Fund and Federated Hermes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Federated Hermes
The main advantage of trading using opposite Growth Fund and Federated Hermes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Federated Hermes 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 Federated Hermes will offset losses from the drop in Federated Hermes' long position.| Growth Fund vs. Federated Hermes Inflation | Growth Fund vs. Aqr Managed Futures | Growth Fund vs. Ab Bond Inflation | Growth Fund vs. Blackrock Inflation Protected |
| Federated Hermes vs. Ab Bond Inflation | Federated Hermes vs. Blackrock Inflation Protected | Federated Hermes vs. Arrow Managed Futures | Federated Hermes vs. Lord Abbett Inflation |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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