Correlation Between Timothy Plan and Upright Growth
Can any of the company-specific risk be diversified away by investing in both Timothy Plan and Upright Growth 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 Timothy Plan and Upright Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timothy Plan High and Upright Growth Income, you can compare the effects of market volatilities on Timothy Plan and Upright Growth 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 Timothy Plan with a short position of Upright Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timothy Plan and Upright Growth.
Diversification Opportunities for Timothy Plan and Upright Growth
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Timothy and Upright is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Timothy Plan High and Upright Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upright Growth Income and Timothy Plan 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 Timothy Plan High are associated (or correlated) with Upright Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upright Growth Income has no effect on the direction of Timothy Plan i.e., Timothy Plan and Upright Growth go up and down completely randomly.
Pair Corralation between Timothy Plan and Upright Growth
Assuming the 90 days horizon Timothy Plan is expected to generate 3.31 times less return on investment than Upright Growth. But when comparing it to its historical volatility, Timothy Plan High is 7.78 times less risky than Upright Growth. It trades about 0.16 of its potential returns per unit of risk. Upright Growth Income is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,195 in Upright Growth Income on November 2, 2024 and sell it today you would earn a total of 818.00 from holding Upright Growth Income or generate 68.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Timothy Plan High vs. Upright Growth Income
Performance |
| Timeline |
| Timothy Plan High |
| Upright Growth Income |
Timothy Plan and Upright Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timothy Plan and Upright Growth
The main advantage of trading using opposite Timothy Plan and Upright Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timothy Plan position performs unexpectedly, Upright Growth 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 Upright Growth will offset losses from the drop in Upright Growth's long position.| Timothy Plan vs. Smallcap Fund Fka | Timothy Plan vs. Praxis Small Cap | Timothy Plan vs. Lebenthal Lisanti Small | Timothy Plan vs. Tax Managed Mid Small |
| Upright Growth vs. Live Oak Health | Upright Growth vs. Blackrock Health Sciences | Upright Growth vs. Highland Longshort Healthcare | Upright Growth vs. Eaton Vance Worldwide |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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