Correlation Between Ivy Science and Sextant Growth

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

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

Diversification Opportunities for Ivy Science and Sextant Growth

0.79

Correlation Coefficient

Ivy Science  Sextant Growth

Poor diversification

The 3 months correlation between Ivy and Sextant is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ivy Science And and Sextant Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sextant Growth and Ivy Science 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 Ivy Science And are associated (or correlated) with Sextant Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sextant Growth has no effect on the direction of Ivy Science i.e., Ivy Science and Sextant Growth go up and down completely randomly.

Pair Corralation between Ivy Science and Sextant Growth

Assuming the 90 days horizon Ivy Science And is expected to under-perform the Sextant Growth. In addition to that, Ivy Science is 2.5 times more volatile than Sextant Growth Fund. It trades about -0.01 of its total potential returns per unit of risk. Sextant Growth Fund is currently generating about 0.18 per unit of volatility. If you would invest  5,184  in Sextant Growth Fund on September 5, 2024 and sell it today you would earn a total of  554.00  from holding Sextant Growth Fund or generate 10.69% return on investment over 90 days.

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

Ivy Science And  vs.  Sextant Growth Fund

Ivy Science And

Risk-Adjusted Performance

0 of 100

Very Weak

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

Sextant Growth

Risk-Adjusted Performance

14 of 100

Good

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

Pair Trading with Ivy Science and Sextant Growth

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

The idea behind Ivy Science And and Sextant 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.