Correlation Between CARPENTER and American Funds
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By analyzing existing cross correlation between CARPENTER TECHNOLOGY P and American Funds 2050, you can compare the effects of market volatilities on CARPENTER and American Funds 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 CARPENTER with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of CARPENTER and American Funds.
Diversification Opportunities for CARPENTER and American Funds
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CARPENTER and American is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding CARPENTER TECHNOLOGY P and American Funds 2050 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds 2050 and CARPENTER 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 CARPENTER TECHNOLOGY P are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds 2050 has no effect on the direction of CARPENTER i.e., CARPENTER and American Funds go up and down completely randomly.
Pair Corralation between CARPENTER and American Funds
Assuming the 90 days trading horizon CARPENTER TECHNOLOGY P is expected to under-perform the American Funds. But the bond apears to be less risky and, when comparing its historical volatility, CARPENTER TECHNOLOGY P is 1.55 times less risky than American Funds. The bond trades about -0.01 of its potential returns per unit of risk. The American Funds 2050 is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,181 in American Funds 2050 on September 13, 2024 and sell it today you would earn a total of 30.00 from holding American Funds 2050 or generate 1.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CARPENTER TECHNOLOGY P vs. American Funds 2050
Performance |
| Timeline |
| CARPENTER TECHNOLOGY |
| American Funds 2050 |
CARPENTER and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CARPENTER and American Funds
The main advantage of trading using opposite CARPENTER and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CARPENTER position performs unexpectedly, American Funds 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 Funds will offset losses from the drop in American Funds' long position.| CARPENTER vs. HUTCHMED DRC | CARPENTER vs. The Coca Cola | CARPENTER vs. Amgen Inc | CARPENTER vs. enVVeno Medical Corp |
| American Funds vs. Income Fund Of | American Funds vs. New World Fund | American Funds vs. American Mutual Fund | American Funds vs. American Mutual Fund |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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