Correlation Between William Blair and Chase Growth

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

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

Diversification Opportunities for William Blair and Chase Growth

0.99

Correlation Coefficient

William Blair  Chase Growth

No risk reduction

The 3 months correlation between WILLIAM and Chase is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding William Blair Growth and Chase Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chase Growth and William Blair 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 William Blair Growth are associated (or correlated) with Chase Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chase Growth has no effect on the direction of William Blair i.e., William Blair and Chase Growth go up and down completely randomly.

Pair Corralation between William Blair and Chase Growth

Assuming the 90 days horizon William Blair is expected to generate 1.28 times less return on investment than Chase Growth. In addition to that, William Blair is 1.08 times more volatile than Chase Growth Fund. It trades about 0.19 of its total potential returns per unit of risk. Chase Growth Fund is currently generating about 0.26 per unit of volatility. If you would invest  1,541  in Chase Growth Fund on September 3, 2024 and sell it today you would earn a total of  228.00  from holding Chase Growth Fund or generate 14.8% return on investment over 90 days.

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

William Blair Growth  vs.  Chase Growth Fund

William Blair Growth

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in William Blair Growth are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, William Blair may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Chase Growth

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Chase Growth Fund are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Chase Growth showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with William Blair and Chase Growth

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

The idea behind William Blair Growth and Chase 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 Stocks Directory module to find actively traded stocks across global markets.