Correlation Between Aggressive Growth and Eventide Healthcare
Can any of the company-specific risk be diversified away by investing in both Aggressive Growth and Eventide Healthcare 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 Aggressive Growth and Eventide Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aggressive Growth Fund and Eventide Healthcare Life, you can compare the effects of market volatilities on Aggressive Growth and Eventide Healthcare 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 Aggressive Growth with a short position of Eventide Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aggressive Growth and Eventide Healthcare.
Diversification Opportunities for Aggressive Growth and Eventide Healthcare
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aggressive and Eventide is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Aggressive Growth Fund and Eventide Healthcare Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eventide Healthcare Life and Aggressive 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 Aggressive Growth Fund are associated (or correlated) with Eventide Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eventide Healthcare Life has no effect on the direction of Aggressive Growth i.e., Aggressive Growth and Eventide Healthcare go up and down completely randomly.
Pair Corralation between Aggressive Growth and Eventide Healthcare
Assuming the 90 days horizon Aggressive Growth Fund is expected to generate 0.58 times more return on investment than Eventide Healthcare. However, Aggressive Growth Fund is 1.72 times less risky than Eventide Healthcare. It trades about 0.15 of its potential returns per unit of risk. Eventide Healthcare Life is currently generating about -0.05 per unit of risk. If you would invest 7,058 in Aggressive Growth Fund on September 13, 2024 and sell it today you would earn a total of 224.00 from holding Aggressive Growth Fund or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aggressive Growth Fund vs. Eventide Healthcare Life
Performance |
| Timeline |
| Aggressive Growth |
| Eventide Healthcare Life |
Aggressive Growth and Eventide Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aggressive Growth and Eventide Healthcare
The main advantage of trading using opposite Aggressive Growth and Eventide Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aggressive Growth position performs unexpectedly, Eventide Healthcare 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 Eventide Healthcare will offset losses from the drop in Eventide Healthcare's long position.| Aggressive Growth vs. Jpmorgan Diversified Fund | Aggressive Growth vs. Western Asset Diversified | Aggressive Growth vs. Fulcrum Diversified Absolute | Aggressive Growth vs. Global Diversified Income |
| Eventide Healthcare vs. Falcon Focus Scv | Eventide Healthcare vs. Qs Large Cap | Eventide Healthcare vs. Materials Portfolio Fidelity | Eventide Healthcare vs. Iaadx |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Global Correlations Find global opportunities by holding instruments from different markets |