The Arbitrage Correlations

Mutual Funds . USA . 
Fund . The Arbitrage Fund
ARBFX Fund  USD 13.20  0.05  0.38%   
The current 90-days correlation between The Arbitrage and The Merger Fund is 0.77 (i.e., Poor diversification). The correlation of The Arbitrage is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

The Arbitrage Correlation With Market

Modest diversification

The correlation between The Arbitrage Fund and DJI is 0.21 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding The Arbitrage Fund and DJI in the same portfolio, assuming nothing else is changed.
  
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in The Arbitrage Fund. Also, note that the market value of any mutual fund could be closely tied with the direction of predictive economic indicators such as signals in census.

Moving together with The Mutual Fund

  1.0ARBNX The ArbitragePairCorr
  1.0ARBCX The ArbitragePairCorr
  0.83ARCFX Arbitrage CreditPairCorr
  1.0ARGAX The ArbitragePairCorr
  0.83ACFIX Arbitrage CreditPairCorr
  0.98AEDNX Arbitrage EventPairCorr
  0.98AEDFX Arbitrage EventPairCorr
  0.85AGCAX Arbitrage CreditPairCorr
  0.98AGEAX Arbitrage EventPairCorr
  0.78BCLPX Blckrk Lc CrPairCorr
  0.86BALPX Blckrk Lc CrPairCorr
  0.87BILPX Blkrk Lc CrPairCorr
  0.92MERIX Merger FundPairCorr
  0.92MERFX Merger FundPairCorr
  0.88PFN Pimco Income StrategyPairCorr
  0.7CIF Mfs Intermediate HighPairCorr
  0.74XPPRX Voya Prime RatePairCorr
  0.83PCF Putnam High IncomePairCorr
  0.68EVCGX Eaton Vance GreaterPairCorr
  0.87TUHYX T Rowe PricePairCorr
  0.78ABNCX Ab Bond InflationPairCorr
  0.61RYHCX Health Care FundPairCorr
  0.83BBHLX Bbh Partner FundPairCorr
  0.89BNDIX Total Return BondPairCorr
  0.79BSIKX Blackrock StrategicPairCorr
  0.64HLDFX Hartford EmergingPairCorr
  0.74TTSMX Tennessee Tax FreePairCorr
  0.79PELBX Pimco Emerging LocalPairCorr
  0.82RA Brookfield Real AssetsPairCorr

Moving against The Mutual Fund

  0.48RYCWX Inverse Dow 2xPairCorr

Related Correlations Analysis

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.
High positive correlations   
HSGFX
+ 0.77
CVSIX
CVSIX
+ 0.7
MERFX
GATEX
+ 0.46
MERFX
DIAMX
+ 0.45
GATEX
HSGFX
+ 0.4
MERFX
DIAMX
+ 0.4
MERFX
  
High negative correlations   
GATEX
- 0.36
HSGFX
DIAMX
- 0.16
HSGFX
DIAMX
- 0.09
CVSIX

Risk-Adjusted Indicators

There is a big difference between The Mutual Fund performing well and The Arbitrage Mutual Fund doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze The Arbitrage's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

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