Correlation Between Crawford Dividend and Amer Beacon
Can any of the company-specific risk be diversified away by investing in both Crawford Dividend and Amer Beacon 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 Crawford Dividend and Amer Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crawford Dividend Opportunity and Amer Beacon Ark, you can compare the effects of market volatilities on Crawford Dividend and Amer Beacon 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 Crawford Dividend with a short position of Amer Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford Dividend and Amer Beacon.
Diversification Opportunities for Crawford Dividend and Amer Beacon
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Crawford and Amer is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Dividend Opportunity and Amer Beacon Ark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amer Beacon Ark and Crawford Dividend 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 Crawford Dividend Opportunity are associated (or correlated) with Amer Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amer Beacon Ark has no effect on the direction of Crawford Dividend i.e., Crawford Dividend and Amer Beacon go up and down completely randomly.
Pair Corralation between Crawford Dividend and Amer Beacon
Assuming the 90 days horizon Crawford Dividend is expected to generate 2.98 times less return on investment than Amer Beacon. But when comparing it to its historical volatility, Crawford Dividend Opportunity is 2.12 times less risky than Amer Beacon. It trades about 0.05 of its potential returns per unit of risk. Amer Beacon Ark is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 820.00 in Amer Beacon Ark on September 23, 2024 and sell it today you would earn a total of 769.00 from holding Amer Beacon Ark or generate 93.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Crawford Dividend Opportunity vs. Amer Beacon Ark
Performance |
Timeline |
Crawford Dividend |
Amer Beacon Ark |
Crawford Dividend and Amer Beacon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Crawford Dividend and Amer Beacon
The main advantage of trading using opposite Crawford Dividend and Amer Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crawford Dividend position performs unexpectedly, Amer Beacon 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 Amer Beacon will offset losses from the drop in Amer Beacon's long position.Crawford Dividend vs. Calvert Small Cap | Crawford Dividend vs. Siit Dynamic Asset | Crawford Dividend vs. Small Pany Fund | Crawford Dividend vs. Loomis Sayles Small |
Amer Beacon vs. American Beacon Ssi | Amer Beacon vs. American Beacon Bridgeway | Amer Beacon vs. American Beacon Bridgeway | Amer Beacon vs. American Beacon Twentyfour |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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