Correlation Between Nationwide Mid and Bruce Fund

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

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

Diversification Opportunities for Nationwide Mid and Bruce Fund

-0.26

Correlation Coefficient

Nationwide Mid  Bruce Fund

Very good diversification

The 3 months correlation between Nationwide and Bruce is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Mid Cap and Bruce Fund Bruce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bruce Fund Bruce and Nationwide 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 Nationwide Mid Cap are associated (or correlated) with Bruce Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bruce Fund Bruce has no effect on the direction of Nationwide Mid i.e., Nationwide Mid and Bruce Fund go up and down completely randomly.

Pair Corralation between Nationwide Mid and Bruce Fund

Assuming the 90 days horizon Nationwide Mid Cap is expected to generate 1.8 times more return on investment than Bruce Fund. However, Nationwide Mid is 1.8 times more volatile than Bruce Fund Bruce. It trades about 0.2 of its potential returns per unit of risk. Bruce Fund Bruce is currently generating about 0.0 per unit of risk. If you would invest  1,744  in Nationwide Mid Cap on September 4, 2024 and sell it today you would earn a total of  212.00  from holding Nationwide Mid Cap or generate 12.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nationwide Mid Cap  vs.  Bruce Fund Bruce

Nationwide Mid Cap

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nationwide Mid Cap are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Nationwide Mid may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Bruce Fund Bruce

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Nationwide Mid and Bruce Fund

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

The idea behind Nationwide Mid Cap and Bruce Fund Bruce 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.