Correlation Between Amer Beacon and Jacob Internet
Can any of the company-specific risk be diversified away by investing in both Amer Beacon and Jacob Internet 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 Amer Beacon and Jacob Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amer Beacon Ark and Jacob Internet Fund, you can compare the effects of market volatilities on Amer Beacon and Jacob Internet 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 Amer Beacon with a short position of Jacob Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amer Beacon and Jacob Internet.
Diversification Opportunities for Amer Beacon and Jacob Internet
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amer and Jacob is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Amer Beacon Ark and Jacob Internet Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacob Internet and Amer Beacon 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 Amer Beacon Ark are associated (or correlated) with Jacob Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacob Internet has no effect on the direction of Amer Beacon i.e., Amer Beacon and Jacob Internet go up and down completely randomly.
Pair Corralation between Amer Beacon and Jacob Internet
Assuming the 90 days horizon Amer Beacon Ark is expected to under-perform the Jacob Internet. In addition to that, Amer Beacon is 1.1 times more volatile than Jacob Internet Fund. It trades about -0.26 of its total potential returns per unit of risk. Jacob Internet Fund is currently generating about -0.06 per unit of volatility. If you would invest 619.00 in Jacob Internet Fund on December 5, 2024 and sell it today you would lose (21.00) from holding Jacob Internet Fund or give up 3.39% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Amer Beacon Ark vs. Jacob Internet Fund
Performance |
Timeline |
Amer Beacon Ark |
Jacob Internet |
Amer Beacon and Jacob Internet Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amer Beacon and Jacob Internet
The main advantage of trading using opposite Amer Beacon and Jacob Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amer Beacon position performs unexpectedly, Jacob Internet 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 Jacob Internet will offset losses from the drop in Jacob Internet's long position.Amer Beacon vs. Ridgeworth Innovative Growth | Amer Beacon vs. Mid Cap Growth | Amer Beacon vs. Small Pany Growth | Amer Beacon vs. Morgan Stanley Multi |
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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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