Correlation Between Marsico Focus and Credit Suisse

Can any of the company-specific risk be diversified away by investing in both Marsico Focus and Credit Suisse 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 Marsico Focus and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Marsico Focus Fund and Credit Suisse Modity, you can compare the effects of market volatilities on Marsico Focus and Credit Suisse 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 Marsico Focus with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marsico Focus and Credit Suisse.

Diversification Opportunities for Marsico Focus and Credit Suisse

-0.39

Correlation Coefficient

Marsico Focus  Credit Suisse

Very good diversification

The 3 months correlation between Marsico and Credit is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Marsico Focus Fund and Credit Suisse Modity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Modity and Marsico Focus 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 Marsico Focus Fund are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Modity has no effect on the direction of Marsico Focus i.e., Marsico Focus and Credit Suisse go up and down completely randomly.

Pair Corralation between Marsico Focus and Credit Suisse

Assuming the 90 days horizon Marsico Focus Fund is expected to under-perform the Credit Suisse. In addition to that, Marsico Focus is 1.94 times more volatile than Credit Suisse Modity. It trades about -0.25 of its total potential returns per unit of risk. Credit Suisse Modity is currently generating about 0.04 per unit of volatility. If you would invest  2,381  in Credit Suisse Modity on December 5, 2024 and sell it today you would earn a total of  11.00  from holding Credit Suisse Modity or generate 0.46% return on investment over 90 days.

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

Marsico Focus Fund  vs.  Credit Suisse Modity

Marsico Focus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Marsico Focus Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Credit Suisse Modity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Credit Suisse Modity are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Credit Suisse may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Marsico Focus and Credit Suisse

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

The idea behind Marsico Focus Fund and Credit Suisse Modity 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.