Correlation Between Fisher Large and Small Cap

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

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

Diversification Opportunities for Fisher Large and Small Cap

0.0

Correlation Coefficient

Fisher Large  Small Cap

Pay attention - limited upside

The 3 months correlation between Fisher and Small is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fisher Large Cap and Small Cap Value Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Value and Fisher Large 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 Fisher Large Cap are associated (or correlated) with Small Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Value has no effect on the direction of Fisher Large i.e., Fisher Large and Small Cap go up and down completely randomly.

Pair Corralation between Fisher Large and Small Cap

If you would invest  1,797  in Fisher Large Cap on October 24, 2024 and sell it today you would earn a total of  60.00  from holding Fisher Large Cap or generate 3.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Fisher Large Cap  vs.  Small Cap Value Profund

Fisher Large Cap

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Fisher Large Cap are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Fisher Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Small Cap Value

Risk-Adjusted Performance

0 of 100

Insignificant

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

Pair Trading with Fisher Large and Small Cap

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

The idea behind Fisher Large Cap and Small Cap Value Profund 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.