Correlation Between Growth Fund and American Century
Can any of the company-specific risk be diversified away by investing in both Growth Fund and American Century 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 Fund and American Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Investor and American Century Focused, you can compare the effects of market volatilities on Growth Fund and American Century 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 Fund with a short position of American Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and American Century.
Diversification Opportunities for Growth Fund and American Century
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Growth and American is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Investor and American Century Focused in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Century Focused and Growth Fund 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 Fund Investor are associated (or correlated) with American Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Century Focused has no effect on the direction of Growth Fund i.e., Growth Fund and American Century go up and down completely randomly.
Pair Corralation between Growth Fund and American Century
Assuming the 90 days horizon Growth Fund Investor is expected to generate 1.07 times more return on investment than American Century. However, Growth Fund is 1.07 times more volatile than American Century Focused. It trades about 0.17 of its potential returns per unit of risk. American Century Focused is currently generating about -0.04 per unit of risk. If you would invest 5,687 in Growth Fund Investor on September 12, 2024 and sell it today you would earn a total of 573.00 from holding Growth Fund Investor or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Growth Fund Investor vs. American Century Focused
Performance |
| Timeline |
| Growth Fund Investor |
| American Century Focused |
Growth Fund and American Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and American Century
The main advantage of trading using opposite Growth Fund and American Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, American Century 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 American Century will offset losses from the drop in American Century's long position.| Growth Fund vs. Select Fund Investor | Growth Fund vs. Ultra Fund Investor | Growth Fund vs. Heritage Fund Investor | Growth Fund vs. International Growth Fund |
| American Century vs. Live Oak Health | American Century vs. Blackrock Health Sciences | American Century vs. Delaware Healthcare Fund | American Century vs. Eventide Healthcare Life |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |