Correlation Between Timothy Plan and Value Fund
Can any of the company-specific risk be diversified away by investing in both Timothy Plan and Value Fund 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 Value Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timothy Plan International and Value Fund Value, you can compare the effects of market volatilities on Timothy Plan and Value Fund 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 Value Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timothy Plan and Value Fund.
Diversification Opportunities for Timothy Plan and Value Fund
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Timothy and Value is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Timothy Plan International and Value Fund Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Fund Value 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 International are associated (or correlated) with Value Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Fund Value has no effect on the direction of Timothy Plan i.e., Timothy Plan and Value Fund go up and down completely randomly.
Pair Corralation between Timothy Plan and Value Fund
Assuming the 90 days horizon Timothy Plan International is expected to under-perform the Value Fund. In addition to that, Timothy Plan is 1.0 times more volatile than Value Fund Value. It trades about -0.13 of its total potential returns per unit of risk. Value Fund Value is currently generating about 0.28 per unit of volatility. If you would invest 5,539 in Value Fund Value on August 31, 2024 and sell it today you would earn a total of 249.00 from holding Value Fund Value or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Timothy Plan International vs. Value Fund Value
Performance |
| Timeline |
| Timothy Plan Interna |
| Value Fund Value |
Timothy Plan and Value Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timothy Plan and Value Fund
The main advantage of trading using opposite Timothy Plan and Value Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timothy Plan position performs unexpectedly, Value Fund 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 Value Fund will offset losses from the drop in Value Fund's long position.| Timothy Plan vs. Vanguard Total International | Timothy Plan vs. Vanguard Developed Markets | Timothy Plan vs. Vanguard Developed Markets | Timothy Plan vs. HUMANA INC |
| Value Fund vs. Inverse Government Long | Value Fund vs. John Hancock Government | Value Fund vs. Dreyfus Government Cash | Value Fund vs. Us Government Securities |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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