Correlation Between Partners Value and Clipper Fund
Can any of the company-specific risk be diversified away by investing in both Partners Value and Clipper 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 Partners Value and Clipper Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Partners Value Fund and Clipper Fund Inc, you can compare the effects of market volatilities on Partners Value and Clipper 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 Partners Value with a short position of Clipper Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Partners Value and Clipper Fund.
Diversification Opportunities for Partners Value and Clipper Fund
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Partners and CLIPPER is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Partners Value Fund and Clipper Fund Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clipper Fund and Partners Value 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 Partners Value Fund are associated (or correlated) with Clipper Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clipper Fund has no effect on the direction of Partners Value i.e., Partners Value and Clipper Fund go up and down completely randomly.
Pair Corralation between Partners Value and Clipper Fund
Assuming the 90 days horizon Partners Value is expected to generate 1.48 times less return on investment than Clipper Fund. But when comparing it to its historical volatility, Partners Value Fund is 1.05 times less risky than Clipper Fund. It trades about 0.06 of its potential returns per unit of risk. Clipper Fund Inc is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 10,547 in Clipper Fund Inc on August 29, 2024 and sell it today you would earn a total of 5,006 from holding Clipper Fund Inc or generate 47.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Partners Value Fund vs. Clipper Fund Inc
Performance |
| Timeline |
| Partners Value |
| Clipper Fund |
Partners Value and Clipper Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Partners Value and Clipper Fund
The main advantage of trading using opposite Partners Value and Clipper Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Partners Value position performs unexpectedly, Clipper 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 Clipper Fund will offset losses from the drop in Clipper Fund's long position.| Partners Value vs. Value Fund Value | Partners Value vs. Clipper Fund Inc | Partners Value vs. Longleaf Partners Fund | Partners Value vs. Meridian Trarian Fund |
| Clipper Fund vs. Value Fund Value | Clipper Fund vs. Meridian Trarian Fund | Clipper Fund vs. Longleaf Partners Fund | Clipper Fund vs. Mairs Power Growth |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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