Correlation Between Guidestone Funds and James Balanced
Can any of the company-specific risk be diversified away by investing in both Guidestone Funds and James Balanced 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 Guidestone Funds and James Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidestone Funds and James Balanced Golden, you can compare the effects of market volatilities on Guidestone Funds and James Balanced 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 Guidestone Funds with a short position of James Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidestone Funds and James Balanced.
Diversification Opportunities for Guidestone Funds and James Balanced
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Guidestone and James is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Guidestone Funds and James Balanced Golden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on James Balanced Golden and Guidestone Funds 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 Guidestone Funds are associated (or correlated) with James Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of James Balanced Golden has no effect on the direction of Guidestone Funds i.e., Guidestone Funds and James Balanced go up and down completely randomly.
Pair Corralation between Guidestone Funds and James Balanced
Assuming the 90 days horizon Guidestone Funds is expected to under-perform the James Balanced. But the mutual fund apears to be less risky and, when comparing its historical volatility, Guidestone Funds is 1.4 times less risky than James Balanced. The mutual fund trades about -0.13 of its potential returns per unit of risk. The James Balanced Golden is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,282 in James Balanced Golden on September 13, 2024 and sell it today you would earn a total of 5.00 from holding James Balanced Golden or generate 0.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Guidestone Funds vs. James Balanced Golden
Performance |
Timeline |
Guidestone Funds |
James Balanced Golden |
Guidestone Funds and James Balanced Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guidestone Funds and James Balanced
The main advantage of trading using opposite Guidestone Funds and James Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidestone Funds position performs unexpectedly, James Balanced 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 James Balanced will offset losses from the drop in James Balanced's long position.Guidestone Funds vs. Growth Allocation Fund | Guidestone Funds vs. Defensive Market Strategies | Guidestone Funds vs. Defensive Market Strategies | Guidestone Funds vs. Value Equity Institutional |
James Balanced vs. Permanent Portfolio Class | James Balanced vs. Berwyn Income Fund | James Balanced vs. Large Cap Fund | James Balanced vs. Westcore Plus Bond |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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