Correlation Between Ultranasdaq-100 Profund and American Funds

Can any of the company-specific risk be diversified away by investing in both Ultranasdaq-100 Profund and American Funds 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 Ultranasdaq-100 Profund and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ultranasdaq 100 Profund Ultranasdaq 100 and American Funds International, you can compare the effects of market volatilities on Ultranasdaq-100 Profund and American Funds 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 Ultranasdaq-100 Profund with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultranasdaq-100 Profund and American Funds.

Diversification Opportunities for Ultranasdaq-100 Profund and American Funds

0.0

Correlation Coefficient

Ultranasdaq-100 Profund  American Funds

Pay attention - limited upside

The 3 months correlation between Ultranasdaq-100 and American is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ultranasdaq 100 Profund Ultran and American Funds International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds Inter and Ultranasdaq-100 Profund 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 Ultranasdaq 100 Profund Ultranasdaq 100 are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds Inter has no effect on the direction of Ultranasdaq-100 Profund i.e., Ultranasdaq-100 Profund and American Funds go up and down completely randomly.

Pair Corralation between Ultranasdaq-100 Profund and American Funds

Assuming the 90 days horizon Ultranasdaq-100 Profund is expected to generate 12.47 times less return on investment than American Funds. In addition to that, Ultranasdaq-100 Profund is 3.26 times more volatile than American Funds International. It trades about 0.01 of its total potential returns per unit of risk. American Funds International is currently generating about 0.23 per unit of volatility. If you would invest  1,632  in American Funds International on October 23, 2024 and sell it today you would earn a total of  49.00  from holding American Funds International or generate 3.0% return on investment over 90 days.

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

Ultranasdaq 100 Profund Ultran  vs.  American Funds International

Ultranasdaq 100 Profund

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ultranasdaq 100 Profund Ultranasdaq 100 are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ultranasdaq-100 Profund showed solid returns over the last few months and may actually be approaching a breakup point.

American Funds Inter

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Ultranasdaq-100 Profund and American Funds

The main advantage of trading using opposite Ultranasdaq-100 Profund and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultranasdaq-100 Profund position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.

The idea behind Ultranasdaq 100 Profund Ultranasdaq 100 and American Funds International 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.