Correlation Between Amg Yacktman and Large Cap
Can any of the company-specific risk be diversified away by investing in both Amg Yacktman and Large Cap 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 Amg Yacktman and Large Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Yacktman Fund and Large Cap Fund, you can compare the effects of market volatilities on Amg Yacktman and Large Cap 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 Amg Yacktman with a short position of Large Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Yacktman and Large Cap.
Diversification Opportunities for Amg Yacktman and Large Cap
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AMG and Large is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Amg Yacktman Fund and Large Cap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Large Cap Fund and Amg Yacktman 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 Amg Yacktman Fund are associated (or correlated) with Large Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Large Cap Fund has no effect on the direction of Amg Yacktman i.e., Amg Yacktman and Large Cap go up and down completely randomly.
Pair Corralation between Amg Yacktman and Large Cap
Assuming the 90 days horizon Amg Yacktman is expected to generate 1.07 times less return on investment than Large Cap. But when comparing it to its historical volatility, Amg Yacktman Fund is 1.46 times less risky than Large Cap. It trades about 0.09 of its potential returns per unit of risk. Large Cap Fund is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,442 in Large Cap Fund on August 31, 2024 and sell it today you would earn a total of 329.00 from holding Large Cap Fund or generate 22.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Amg Yacktman Fund vs. Large Cap Fund
Performance |
| Timeline |
| Amg Yacktman |
| Large Cap Fund |
Amg Yacktman and Large Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Yacktman and Large Cap
The main advantage of trading using opposite Amg Yacktman and Large Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Yacktman position performs unexpectedly, Large Cap 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 Large Cap will offset losses from the drop in Large Cap's long position.| Amg Yacktman vs. Dodge Cox Stock | Amg Yacktman vs. American Mutual Fund | Amg Yacktman vs. American Funds American | Amg Yacktman vs. American Funds American |
| Large Cap vs. Wasatch Large Cap | Large Cap vs. Loomis Sayles Bond | Large Cap vs. Harbor International Fund | Large Cap vs. Equity Series Class |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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