Correlation Between Alger Mid and ASPY

Can any of the company-specific risk be diversified away by investing in both Alger Mid and ASPY 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 Alger Mid and ASPY into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alger Mid Cap and ASPY, you can compare the effects of market volatilities on Alger Mid and ASPY 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 Alger Mid with a short position of ASPY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Mid and ASPY.

Diversification Opportunities for Alger Mid and ASPY

-0.01

Correlation Coefficient

Alger Mid  ASPY

Good diversification

The 3 months correlation between Alger and ASPY is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Alger Mid Cap and ASPY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASPY and Alger Mid 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 Alger Mid Cap are associated (or correlated) with ASPY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASPY has no effect on the direction of Alger Mid i.e., Alger Mid and ASPY go up and down completely randomly.

Pair Corralation between Alger Mid and ASPY

If you would invest  2,671  in ASPY on October 7, 2024 and sell it today you would earn a total of  0.00  from holding ASPY or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Alger Mid Cap  vs.  ASPY

Alger Mid Cap

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alger Mid Cap are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Alger Mid showed solid returns over the last few months and may actually be approaching a breakup point.

ASPY

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ASPY has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, ASPY is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alger Mid and ASPY

The main advantage of trading using opposite Alger Mid and ASPY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Mid position performs unexpectedly, ASPY 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 ASPY will offset losses from the drop in ASPY's long position.

The idea behind Alger Mid Cap and ASPY pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Money Managers module to screen money managers from public funds and ETFs managed around the world.