Correlation Between Scout Unconstrained and Eagle Small
Can any of the company-specific risk be diversified away by investing in both Scout Unconstrained and Eagle Small 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 Scout Unconstrained and Eagle Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scout Unconstrained Bond and Eagle Small Cap, you can compare the effects of market volatilities on Scout Unconstrained and Eagle Small 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 Scout Unconstrained with a short position of Eagle Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scout Unconstrained and Eagle Small.
Diversification Opportunities for Scout Unconstrained and Eagle Small
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Scout and Eagle is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Scout Unconstrained Bond and Eagle Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Small Cap and Scout Unconstrained 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 Scout Unconstrained Bond are associated (or correlated) with Eagle Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Small Cap has no effect on the direction of Scout Unconstrained i.e., Scout Unconstrained and Eagle Small go up and down completely randomly.
Pair Corralation between Scout Unconstrained and Eagle Small
Assuming the 90 days horizon Scout Unconstrained Bond is expected to under-perform the Eagle Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Scout Unconstrained Bond is 6.23 times less risky than Eagle Small. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Eagle Small Cap is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 3,157 in Eagle Small Cap on August 24, 2024 and sell it today you would earn a total of 203.00 from holding Eagle Small Cap or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Scout Unconstrained Bond vs. Eagle Small Cap
Performance |
| Timeline |
| Scout Unconstrained Bond |
| Eagle Small Cap |
Scout Unconstrained and Eagle Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scout Unconstrained and Eagle Small
The main advantage of trading using opposite Scout Unconstrained and Eagle Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scout Unconstrained position performs unexpectedly, Eagle Small 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 Eagle Small will offset losses from the drop in Eagle Small's long position.The idea behind Scout Unconstrained Bond and Eagle Small Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Eagle Small vs. Eagle Growth Income | Eagle Small vs. Eagle Growth Income | Eagle Small vs. Eagle Capital Appreciation | Eagle Small vs. Eagle Capital Appreciation |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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