Correlation Between American Funds and Alger Concentrated
Can any of the company-specific risk be diversified away by investing in both American Funds and Alger Concentrated 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 American Funds and Alger Concentrated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds The and Alger Concentrated Equity, you can compare the effects of market volatilities on American Funds and Alger Concentrated 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 American Funds with a short position of Alger Concentrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Alger Concentrated.
Diversification Opportunities for American Funds and Alger Concentrated
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between American and Alger is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding American Funds The and Alger Concentrated Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Concentrated Equity and American Funds 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 American Funds The are associated (or correlated) with Alger Concentrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Concentrated Equity has no effect on the direction of American Funds i.e., American Funds and Alger Concentrated go up and down completely randomly.
Pair Corralation between American Funds and Alger Concentrated
Assuming the 90 days horizon American Funds The is expected to under-perform the Alger Concentrated. But the mutual fund apears to be less risky and, when comparing its historical volatility, American Funds The is 1.04 times less risky than Alger Concentrated. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Alger Concentrated Equity is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,308 in Alger Concentrated Equity on December 2, 2024 and sell it today you would lose (34.00) from holding Alger Concentrated Equity or give up 2.6% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
American Funds The vs. Alger Concentrated Equity
Performance |
Timeline |
American Funds |
Alger Concentrated Equity |
American Funds and Alger Concentrated Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with American Funds and Alger Concentrated
The main advantage of trading using opposite American Funds and Alger Concentrated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Alger Concentrated 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 Alger Concentrated will offset losses from the drop in Alger Concentrated's long position.American Funds vs. Principal Lifetime Hybrid | American Funds vs. Blackrock Diversified Fixed | American Funds vs. Aqr Diversified Arbitrage | American Funds vs. Harbor Diversified International |
Alger Concentrated vs. Siit Emerging Markets | Alger Concentrated vs. Artisan Developing World | Alger Concentrated vs. Pimco Emerging Markets | Alger Concentrated vs. Wasatch Frontier Emerging |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume |