Correlation Between Growth Opportunities and Eic Value
Can any of the company-specific risk be diversified away by investing in both Growth Opportunities and Eic Value 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 Opportunities and Eic Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Opportunities Fund and Eic Value Fund, you can compare the effects of market volatilities on Growth Opportunities and Eic Value 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 Opportunities with a short position of Eic Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Opportunities and Eic Value.
Diversification Opportunities for Growth Opportunities and Eic Value
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GROWTH and Eic is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Growth Opportunities Fund and Eic Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eic Value Fund and Growth Opportunities 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 Opportunities Fund are associated (or correlated) with Eic Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eic Value Fund has no effect on the direction of Growth Opportunities i.e., Growth Opportunities and Eic Value go up and down completely randomly.
Pair Corralation between Growth Opportunities and Eic Value
Assuming the 90 days horizon Growth Opportunities Fund is expected to generate 1.81 times more return on investment than Eic Value. However, Growth Opportunities is 1.81 times more volatile than Eic Value Fund. It trades about 0.11 of its potential returns per unit of risk. Eic Value Fund is currently generating about 0.13 per unit of risk. If you would invest 5,064 in Growth Opportunities Fund on September 2, 2024 and sell it today you would earn a total of 792.00 from holding Growth Opportunities Fund or generate 15.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Opportunities Fund vs. Eic Value Fund
Performance |
| Timeline |
| Growth Opportunities |
| Eic Value Fund |
Growth Opportunities and Eic Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Opportunities and Eic Value
The main advantage of trading using opposite Growth Opportunities and Eic Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Opportunities position performs unexpectedly, Eic Value 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 Eic Value will offset losses from the drop in Eic Value's long position.| Growth Opportunities vs. Mid Cap Value Profund | Growth Opportunities vs. Mutual Of America | Growth Opportunities vs. American Century Etf | Growth Opportunities vs. Heartland Value Plus |
| Eic Value vs. Alliancebernstein National Municipal | Eic Value vs. Pace Municipal Fixed | Eic Value vs. The National Tax Free | Eic Value vs. Bbh Intermediate Municipal |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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