Correlation Between James Balanced and Intrepid Endurance

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

By analyzing existing cross correlation between James Balanced Golden and Intrepid Endurance Fund, you can compare the effects of market volatilities on James Balanced and Intrepid Endurance 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 James Balanced with a short position of Intrepid Endurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of James Balanced and Intrepid Endurance.

Diversification Opportunities for James Balanced and Intrepid Endurance

0.01

Correlation Coefficient

James Balanced  Intrepid Endurance

Significant diversification

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

Pair Corralation between James Balanced and Intrepid Endurance

Assuming the 90 days horizon James Balanced Golden is expected to under-perform the Intrepid Endurance. But the mutual fund apears to be less risky and, when comparing its historical volatility, James Balanced Golden is 1.41 times less risky than Intrepid Endurance. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Intrepid Endurance Fund is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  1,590  in Intrepid Endurance Fund on September 16, 2024 and sell it today you would earn a total of  35.00  from holding Intrepid Endurance Fund or generate 2.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	38.1%
Values	Daily Returns

James Balanced Golden  vs.  Intrepid Endurance Fund

James Balanced Golden

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days James Balanced Golden has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, James Balanced is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intrepid Endurance

Risk-Adjusted Performance

0 of 100

Weak

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

Pair Trading with James Balanced and Intrepid Endurance

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

The idea behind James Balanced Golden and Intrepid Endurance Fund 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.

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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.