Correlation Between Regal Funds and Flagship Investments
Can any of the company-specific risk be diversified away by investing in both Regal Funds and Flagship Investments 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 Regal Funds and Flagship Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regal Funds Management and Flagship Investments, you can compare the effects of market volatilities on Regal Funds and Flagship Investments 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 Regal Funds with a short position of Flagship Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regal Funds and Flagship Investments.
Diversification Opportunities for Regal Funds and Flagship Investments
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Regal and Flagship is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Regal Funds Management and Flagship Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flagship Investments and Regal 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 Regal Funds Management are associated (or correlated) with Flagship Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flagship Investments has no effect on the direction of Regal Funds i.e., Regal Funds and Flagship Investments go up and down completely randomly.
Pair Corralation between Regal Funds and Flagship Investments
Assuming the 90 days trading horizon Regal Funds Management is expected to generate 1.36 times more return on investment than Flagship Investments. However, Regal Funds is 1.36 times more volatile than Flagship Investments. It trades about -0.06 of its potential returns per unit of risk. Flagship Investments is currently generating about -0.08 per unit of risk. If you would invest 383.00 in Regal Funds Management on October 11, 2024 and sell it today you would lose (13.00) from holding Regal Funds Management or give up 3.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regal Funds Management vs. Flagship Investments
Performance |
| Timeline |
| Regal Funds Management |
| Flagship Investments |
Regal Funds and Flagship Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regal Funds and Flagship Investments
The main advantage of trading using opposite Regal Funds and Flagship Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regal Funds position performs unexpectedly, Flagship Investments 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 Flagship Investments will offset losses from the drop in Flagship Investments' long position.| Regal Funds vs. Stelar Metals | Regal Funds vs. Everest Metals | Regal Funds vs. ACDC Metals | Regal Funds vs. Autosports Group |
| Flagship Investments vs. Charter Hall Retail | Flagship Investments vs. Platinum Asset Management | Flagship Investments vs. Regal Funds Management | Flagship Investments vs. Step One Clothing |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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