Correlation Between Eagle Growth and Chartwell Small
Can any of the company-specific risk be diversified away by investing in both Eagle Growth and Chartwell Small 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 Eagle Growth and Chartwell Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Growth Income and Chartwell Small Cap, you can compare the effects of market volatilities on Eagle Growth and Chartwell Small 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 Eagle Growth with a short position of Chartwell Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Growth and Chartwell Small.
Diversification Opportunities for Eagle Growth and Chartwell Small
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eagle and CHARTWELL is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Growth Income and Chartwell Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chartwell Small Cap and Eagle Growth 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 Eagle Growth Income are associated (or correlated) with Chartwell Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chartwell Small Cap has no effect on the direction of Eagle Growth i.e., Eagle Growth and Chartwell Small go up and down completely randomly.
Pair Corralation between Eagle Growth and Chartwell Small
Assuming the 90 days horizon Eagle Growth is expected to generate 7.05 times less return on investment than Chartwell Small. But when comparing it to its historical volatility, Eagle Growth Income is 1.23 times less risky than Chartwell Small. It trades about 0.01 of its potential returns per unit of risk. Chartwell Small Cap is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,066 in Chartwell Small Cap on December 4, 2024 and sell it today you would earn a total of 493.00 from holding Chartwell Small Cap or generate 46.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Eagle Growth Income vs. Chartwell Small Cap
Performance |
Timeline |
Eagle Growth Income |
Chartwell Small Cap |
Eagle Growth and Chartwell Small Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle Growth and Chartwell Small
The main advantage of trading using opposite Eagle Growth and Chartwell Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Growth position performs unexpectedly, Chartwell Small 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 Chartwell Small will offset losses from the drop in Chartwell Small's long position.Eagle Growth vs. Teton Vertible Securities | Eagle Growth vs. Advent Claymore Convertible | Eagle Growth vs. Harbor Vertible Securities | Eagle Growth vs. Putnam Vertible Securities |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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