Correlation Between Guggenheim Managed and Ab Growth

Can any of the company-specific risk be diversified away by investing in both Guggenheim Managed and Ab Growth 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 Guggenheim Managed and Ab Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guggenheim Managed Futures and Ab Growth Fund, you can compare the effects of market volatilities on Guggenheim Managed and Ab Growth 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 Guggenheim Managed with a short position of Ab Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Managed and Ab Growth.

Diversification Opportunities for Guggenheim Managed and Ab Growth

-0.88

Correlation Coefficient

Guggenheim Managed  Ab Growth

Pay attention - limited upside

The 3 months correlation between Guggenheim and AGRCX is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Managed Futures and Ab Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Growth Fund and Guggenheim Managed 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 Guggenheim Managed Futures are associated (or correlated) with Ab Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Growth Fund has no effect on the direction of Guggenheim Managed i.e., Guggenheim Managed and Ab Growth go up and down completely randomly.

Pair Corralation between Guggenheim Managed and Ab Growth

Assuming the 90 days horizon Guggenheim Managed Futures is expected to generate 0.14 times more return on investment than Ab Growth. However, Guggenheim Managed Futures is 7.13 times less risky than Ab Growth. It trades about -0.04 of its potential returns per unit of risk. Ab Growth Fund is currently generating about -0.05 per unit of risk. If you would invest  2,180  in Guggenheim Managed Futures on October 12, 2024 and sell it today you would lose (118.00) from holding Guggenheim Managed Futures or give up 5.41% of portfolio value over 90 days.

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

Guggenheim Managed Futures  vs.  Ab Growth Fund

Guggenheim Managed

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Managed Futures are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Guggenheim Managed is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ab Growth Fund

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ab Growth 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 February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Guggenheim Managed and Ab Growth

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

The idea behind Guggenheim Managed Futures and Ab Growth Fund 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.