Correlation Between Intrepid Endurance and Amg Yacktman

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

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

Diversification Opportunities for Intrepid Endurance and Amg Yacktman

0.35

Correlation Coefficient

Intrepid Endurance  Amg Yacktman

Weak diversification

The 3 months correlation between Intrepid and Amg is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Intrepid Endurance Fund and Amg Yacktman Focused in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Yacktman Focused and Intrepid Endurance 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 Intrepid Endurance Fund are associated (or correlated) with Amg Yacktman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Yacktman Focused has no effect on the direction of Intrepid Endurance i.e., Intrepid Endurance and Amg Yacktman go up and down completely randomly.

Pair Corralation between Intrepid Endurance and Amg Yacktman

Assuming the 90 days horizon Intrepid Endurance Fund is expected to generate 1.62 times more return on investment than Amg Yacktman. However, Intrepid Endurance is 1.62 times more volatile than Amg Yacktman Focused. It trades about 0.04 of its potential returns per unit of risk. Amg Yacktman Focused is currently generating about -0.01 per unit of risk. If you would invest  1,597  in Intrepid Endurance Fund on September 3, 2024 and sell it today you would earn a total of  28.00  from holding Intrepid Endurance Fund or generate 1.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.31%
Values	Daily Returns

Intrepid Endurance Fund  vs.  Amg Yacktman Focused

Intrepid Endurance

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Intrepid Endurance Fund are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. 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.

Amg Yacktman Focused

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Intrepid Endurance and Amg Yacktman

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

The idea behind Intrepid Endurance Fund and Amg Yacktman Focused 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.