Correlation Between Alger Capital and Alger 35
Can any of the company-specific risk be diversified away by investing in both Alger Capital and Alger 35 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 Alger Capital and Alger 35 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger Capital Appreciation and Alger 35 Fund, you can compare the effects of market volatilities on Alger Capital and Alger 35 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 Alger Capital with a short position of Alger 35. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Capital and Alger 35.
Diversification Opportunities for Alger Capital and Alger 35
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between ALGER and Alger is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Alger Capital Appreciation and Alger 35 Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger 35 Fund and Alger Capital 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 Alger Capital Appreciation are associated (or correlated) with Alger 35. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger 35 Fund has no effect on the direction of Alger Capital i.e., Alger Capital and Alger 35 go up and down completely randomly.
Pair Corralation between Alger Capital and Alger 35
Assuming the 90 days horizon Alger Capital is expected to generate 1.0 times less return on investment than Alger 35. In addition to that, Alger Capital is 1.05 times more volatile than Alger 35 Fund. It trades about 0.13 of its total potential returns per unit of risk. Alger 35 Fund is currently generating about 0.14 per unit of volatility. If you would invest 1,593 in Alger 35 Fund on March 26, 2025 and sell it today you would earn a total of 319.00 from holding Alger 35 Fund or generate 20.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger Capital Appreciation vs. Alger 35 Fund
Performance |
| Timeline |
| Alger Capital Apprec |
| Alger 35 Fund |
Alger Capital and Alger 35 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Capital and Alger 35
The main advantage of trading using opposite Alger Capital and Alger 35 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Capital position performs unexpectedly, Alger 35 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 Alger 35 will offset losses from the drop in Alger 35's long position.| Alger Capital vs. Alger Capital Appreciation | Alger Capital vs. Alger Capital Appreciation | Alger Capital vs. Alger Capital Appreciation | Alger Capital vs. Select Fund C |
| Alger 35 vs. Goldman Sachs Clean | Alger 35 vs. Deutsche Gold Precious | Alger 35 vs. Franklin Gold Precious | Alger 35 vs. Invesco Gold Special |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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