Correlation Between Rbb Fund and Amg Managers

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

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

Diversification Opportunities for Rbb Fund and Amg Managers

0.05

Correlation Coefficient

Rbb Fund  Amg Managers

Significant diversification

The 3 months correlation between Rbb and Amg is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Rbb Fund and Amg Managers Fairpointe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Managers Fairpointe and Rbb Fund 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 Rbb Fund are associated (or correlated) with Amg Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Managers Fairpointe has no effect on the direction of Rbb Fund i.e., Rbb Fund and Amg Managers go up and down completely randomly.

Pair Corralation between Rbb Fund and Amg Managers

Assuming the 90 days horizon Rbb Fund is expected to generate 3.79 times less return on investment than Amg Managers. But when comparing it to its historical volatility, Rbb Fund is 4.29 times less risky than Amg Managers. It trades about 0.09 of its potential returns per unit of risk. Amg Managers Fairpointe is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,569  in Amg Managers Fairpointe on October 9, 2024 and sell it today you would earn a total of  631.00  from holding Amg Managers Fairpointe or generate 40.22% return on investment over 90 days.

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

Rbb Fund   vs.  Amg Managers Fairpointe

Rbb Fund

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rbb Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Rbb Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Amg Managers Fairpointe

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Amg Managers Fairpointe are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Amg Managers is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Rbb Fund and Amg Managers

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

The idea behind Rbb Fund and Amg Managers Fairpointe 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..