Correlation Between Victory Rs and Bruce Fund

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

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

Diversification Opportunities for Victory Rs and Bruce Fund

0.33

Correlation Coefficient

Victory Rs  Bruce Fund

Weak diversification

The 3 months correlation between Victory and Bruce is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Victory Rs Small and Bruce Fund Bruce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bruce Fund Bruce and Victory Rs 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 Victory Rs Small are associated (or correlated) with Bruce Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bruce Fund Bruce has no effect on the direction of Victory Rs i.e., Victory Rs and Bruce Fund go up and down completely randomly.

Pair Corralation between Victory Rs and Bruce Fund

Assuming the 90 days horizon Victory Rs Small is expected to under-perform the Bruce Fund. In addition to that, Victory Rs is 2.19 times more volatile than Bruce Fund Bruce. It trades about -0.12 of its total potential returns per unit of risk. Bruce Fund Bruce is currently generating about 0.19 per unit of volatility. If you would invest  49,886  in Bruce Fund Bruce on December 2, 2024 and sell it today you would earn a total of  2,213  from holding Bruce Fund Bruce or generate 4.44% return on investment over 90 days.

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

Victory Rs Small  vs.  Bruce Fund Bruce

Victory Rs Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Victory Rs Small 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.

Bruce Fund Bruce

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bruce Fund Bruce has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Bruce 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 Victory Rs and Bruce Fund

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

The idea behind Victory Rs Small and Bruce Fund Bruce 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.

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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.