Correlation Between Jacob Micro and Amer Beacon
Can any of the company-specific risk be diversified away by investing in both Jacob Micro and Amer Beacon 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 Jacob Micro and Amer Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacob Micro Cap and Amer Beacon Ark, you can compare the effects of market volatilities on Jacob Micro and Amer Beacon 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 Jacob Micro with a short position of Amer Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacob Micro and Amer Beacon.
Diversification Opportunities for Jacob Micro and Amer Beacon
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jacob and Amer is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Jacob Micro Cap and Amer Beacon Ark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amer Beacon Ark and Jacob Micro 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 Jacob Micro Cap are associated (or correlated) with Amer Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amer Beacon Ark has no effect on the direction of Jacob Micro i.e., Jacob Micro and Amer Beacon go up and down completely randomly.
Pair Corralation between Jacob Micro and Amer Beacon
Assuming the 90 days horizon Jacob Micro Cap is expected to under-perform the Amer Beacon. But the mutual fund apears to be less risky and, when comparing its historical volatility, Jacob Micro Cap is 1.56 times less risky than Amer Beacon. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Amer Beacon Ark is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 1,587 in Amer Beacon Ark on December 27, 2024 and sell it today you would lose (135.00) from holding Amer Beacon Ark or give up 8.51% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Jacob Micro Cap vs. Amer Beacon Ark
Performance |
Timeline |
Jacob Micro Cap |
Amer Beacon Ark |
Jacob Micro and Amer Beacon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jacob Micro and Amer Beacon
The main advantage of trading using opposite Jacob Micro and Amer Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacob Micro position performs unexpectedly, Amer Beacon 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 Amer Beacon will offset losses from the drop in Amer Beacon's long position.Jacob Micro vs. Small Pany Growth | Jacob Micro vs. Jacob Internet Fund | Jacob Micro vs. Jacob Small Cap | Jacob Micro vs. Amer Beacon Ark |
Amer Beacon vs. Ridgeworth Innovative Growth | Amer Beacon vs. Mid Cap Growth | Amer Beacon vs. Small Pany Growth | Amer Beacon vs. Morgan Stanley Multi |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |