Correlation Between Leuthold E and Hussman Strategic

Can any of the company-specific risk be diversified away by investing in both Leuthold E and Hussman Strategic 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 Leuthold E and Hussman Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Leuthold E Investment and Hussman Strategic Growth, you can compare the effects of market volatilities on Leuthold E and Hussman Strategic 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 Leuthold E with a short position of Hussman Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leuthold E and Hussman Strategic.

Diversification Opportunities for Leuthold E and Hussman Strategic

0.0

Correlation Coefficient

Leuthold E  Hussman Strategic

Pay attention - limited upside

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

Pair Corralation between Leuthold E and Hussman Strategic

Assuming the 90 days horizon Leuthold E Investment is expected to under-perform the Hussman Strategic. But the mutual fund apears to be less risky and, when comparing its historical volatility, Leuthold E Investment is 1.86 times less risky than Hussman Strategic. The mutual fund trades about -0.34 of its potential returns per unit of risk. The Hussman Strategic Growth is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  554.00  in Hussman Strategic Growth on October 9, 2024 and sell it today you would lose (10.00) from holding Hussman Strategic Growth or give up 1.81% of portfolio value over 90 days.

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

Leuthold E Investment  vs.  Hussman Strategic Growth

Leuthold E Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leuthold E Investment has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Hussman Strategic Growth

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Leuthold E and Hussman Strategic

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

The idea behind Leuthold E Investment and Hussman Strategic Growth 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.