Correlation Between Upright Assets and Upright Growth

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

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

Diversification Opportunities for Upright Assets and Upright Growth

0.73

Correlation Coefficient

Upright Assets  Upright Growth

Poor diversification

The 3 months correlation between Upright and Upright is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Upright Assets Allocation and Upright Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upright Growth and Upright Assets 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 Upright Assets Allocation are associated (or correlated) with Upright Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upright Growth has no effect on the direction of Upright Assets i.e., Upright Assets and Upright Growth go up and down completely randomly.

Pair Corralation between Upright Assets and Upright Growth

Assuming the 90 days horizon Upright Assets is expected to generate 1.74 times less return on investment than Upright Growth. In addition to that, Upright Assets is 1.04 times more volatile than Upright Growth Fund. It trades about 0.08 of its total potential returns per unit of risk. Upright Growth Fund is currently generating about 0.14 per unit of volatility. If you would invest  958.00  in Upright Growth Fund on September 26, 2024 and sell it today you would earn a total of  150.00  from holding Upright Growth Fund or generate 15.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Upright Assets Allocation  vs.  Upright Growth Fund

Upright Assets Allocation

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Upright Assets Allocation are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Upright Assets may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Upright Growth

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Upright Growth Fund are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Upright Growth showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Upright Assets and Upright Growth

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

The idea behind Upright Assets Allocation and Upright 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.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.