Correlation Between Usaa Nasdaq and International Fund

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

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

Diversification Opportunities for Usaa Nasdaq and International Fund

-0.5

Correlation Coefficient

Usaa Nasdaq  International Fund

Very good diversification

The 3 months correlation between Usaa and International is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Usaa Nasdaq 100 and International Fund Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Fund and Usaa Nasdaq 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 Usaa Nasdaq 100 are associated (or correlated) with International Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Fund has no effect on the direction of Usaa Nasdaq i.e., Usaa Nasdaq and International Fund go up and down completely randomly.

Pair Corralation between Usaa Nasdaq and International Fund

Assuming the 90 days horizon Usaa Nasdaq 100 is expected to generate 1.05 times more return on investment than International Fund. However, Usaa Nasdaq is 1.05 times more volatile than International Fund International. It trades about 0.1 of its potential returns per unit of risk. International Fund International is currently generating about -0.2 per unit of risk. If you would invest  5,039  in Usaa Nasdaq 100 on September 29, 2024 and sell it today you would earn a total of  322.00  from holding Usaa Nasdaq 100 or generate 6.39% return on investment over 90 days.

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

Usaa Nasdaq 100  vs.  International Fund Internation

Usaa Nasdaq 100

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Usaa Nasdaq 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, Usaa Nasdaq may actually be approaching a critical reversion point that can send shares even higher in January 2025.

International Fund

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International Fund International 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 technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Usaa Nasdaq and International Fund

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

The idea behind Usaa Nasdaq 100 and International Fund 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.