Correlation Between Aristotle Growth and Ing Series

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

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

Diversification Opportunities for Aristotle Growth and Ing Series

0.62

Correlation Coefficient

Aristotle Growth  Ing Series

Poor diversification

The 3 months correlation between Aristotle and Ing is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Aristotle Growth Equity and Ing Series Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ing Series Fund and Aristotle Growth 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 Aristotle Growth Equity are associated (or correlated) with Ing Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ing Series Fund has no effect on the direction of Aristotle Growth i.e., Aristotle Growth and Ing Series go up and down completely randomly.

Pair Corralation between Aristotle Growth and Ing Series

Assuming the 90 days horizon Aristotle Growth Equity is expected to generate 1.17 times more return on investment than Ing Series. However, Aristotle Growth is 1.17 times more volatile than Ing Series Fund. It trades about 0.06 of its potential returns per unit of risk. Ing Series Fund is currently generating about 0.05 per unit of risk. If you would invest  1,279  in Aristotle Growth Equity on September 20, 2024 and sell it today you would earn a total of  234.00  from holding Aristotle Growth Equity or generate 18.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	58.17%
Values	Daily Returns

Aristotle Growth Equity  vs.  Ing Series Fund

Aristotle Growth Equity

Risk-Adjusted Performance

0 of 100

Very Weak

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

Ing Series Fund

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ing Series Fund are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental drivers, Ing Series is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Aristotle Growth and Ing Series

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

The idea behind Aristotle Growth Equity and Ing Series 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..