Correlation Between International Growth and Select Fund
Can any of the company-specific risk be diversified away by investing in both International Growth and Select 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 International Growth and Select Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Growth Fund and Select Fund A, you can compare the effects of market volatilities on International Growth and Select 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 International Growth with a short position of Select Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Growth and Select Fund.
Diversification Opportunities for International Growth and Select Fund
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between International and Select is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding International Growth Fund and Select Fund A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Select Fund A and International Growth 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 International Growth Fund are associated (or correlated) with Select Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Select Fund A has no effect on the direction of International Growth i.e., International Growth and Select Fund go up and down completely randomly.
Pair Corralation between International Growth and Select Fund
Assuming the 90 days horizon International Growth Fund is expected to generate 0.65 times more return on investment than Select Fund. However, International Growth Fund is 1.54 times less risky than Select Fund. It trades about 0.02 of its potential returns per unit of risk. Select Fund A is currently generating about -0.04 per unit of risk. If you would invest 1,285 in International Growth Fund on November 2, 2024 and sell it today you would earn a total of 7.00 from holding International Growth Fund or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Growth Fund vs. Select Fund A
Performance |
| Timeline |
| International Growth |
| Select Fund A |
International Growth and Select Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Growth and Select Fund
The main advantage of trading using opposite International Growth and Select Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Growth position performs unexpectedly, Select 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 Select Fund will offset losses from the drop in Select Fund's long position.| International Growth vs. Dws Global Macro | International Growth vs. Dreyfusstandish Global Fixed | International Growth vs. Ms Global Fixed | International Growth vs. Rbb Fund |
| Select Fund vs. Ultra Fund A | Select Fund vs. International Growth Fund | Select Fund vs. Select Fund I | Select Fund vs. Growth Fund A |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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