Correlation Between Amg Fq and Greenspring Fund

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

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

Diversification Opportunities for Amg Fq and Greenspring Fund

0.45

Correlation Coefficient

Amg Fq  Greenspring Fund

Very weak diversification

The 3 months correlation between Amg and Greenspring is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Amg Fq Long Short and Greenspring Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenspring Fund Retail and Amg Fq 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 Amg Fq Long Short are associated (or correlated) with Greenspring Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenspring Fund Retail has no effect on the direction of Amg Fq i.e., Amg Fq and Greenspring Fund go up and down completely randomly.

Pair Corralation between Amg Fq and Greenspring Fund

Assuming the 90 days horizon Amg Fq Long Short is expected to generate 0.78 times more return on investment than Greenspring Fund. However, Amg Fq Long Short is 1.29 times less risky than Greenspring Fund. It trades about 0.04 of its potential returns per unit of risk. Greenspring Fund Retail is currently generating about -0.07 per unit of risk. If you would invest  2,022  in Amg Fq Long Short on December 21, 2024 and sell it today you would earn a total of  34.00  from holding Amg Fq Long Short or generate 1.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Amg Fq Long Short  vs.  Greenspring Fund Retail

Amg Fq Long

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Amg Fq Long Short are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Amg Fq is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Greenspring Fund Retail

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Amg Fq and Greenspring Fund

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

The idea behind Amg Fq Long Short and Greenspring Fund Retail 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.