Correlation Between Valic Company and Viking Tax-free
Can any of the company-specific risk be diversified away by investing in both Valic Company and Viking Tax-free 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 Valic Company and Viking Tax-free into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valic Company I and Viking Tax Free Fund, you can compare the effects of market volatilities on Valic Company and Viking Tax-free 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 Valic Company with a short position of Viking Tax-free. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and Viking Tax-free.
Diversification Opportunities for Valic Company and Viking Tax-free
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valic and Viking is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and Viking Tax Free Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Tax Free and Valic Company 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 Valic Company I are associated (or correlated) with Viking Tax-free. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Tax Free has no effect on the direction of Valic Company i.e., Valic Company and Viking Tax-free go up and down completely randomly.
Pair Corralation between Valic Company and Viking Tax-free
Assuming the 90 days horizon Valic Company I is expected to generate 6.31 times more return on investment than Viking Tax-free. However, Valic Company is 6.31 times more volatile than Viking Tax Free Fund. It trades about 0.2 of its potential returns per unit of risk. Viking Tax Free Fund is currently generating about 0.15 per unit of risk. If you would invest 1,290 in Valic Company I on August 29, 2024 and sell it today you would earn a total of 98.00 from holding Valic Company I or generate 7.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valic Company I vs. Viking Tax Free Fund
Performance |
| Timeline |
| Valic Company I |
| Viking Tax Free |
Valic Company and Viking Tax-free Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valic Company and Viking Tax-free
The main advantage of trading using opposite Valic Company and Viking Tax-free positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valic Company position performs unexpectedly, Viking Tax-free 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 Viking Tax-free will offset losses from the drop in Viking Tax-free's long position.| Valic Company vs. Vanguard Small Cap Value | Valic Company vs. Vanguard Small Cap Value | Valic Company vs. Us Small Cap | Valic Company vs. Us Targeted Value |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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