Correlation Between Alger 35 and Alger Large
Can any of the company-specific risk be diversified away by investing in both Alger 35 and Alger Large 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 35 and Alger Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger 35 Fund and Alger Large Cap, you can compare the effects of market volatilities on Alger 35 and Alger Large 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 35 with a short position of Alger Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger 35 and Alger Large.
Diversification Opportunities for Alger 35 and Alger Large
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 35 Fund and Alger Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Large Cap and Alger 35 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 35 Fund are associated (or correlated) with Alger Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Large Cap has no effect on the direction of Alger 35 i.e., Alger 35 and Alger Large go up and down completely randomly.
Pair Corralation between Alger 35 and Alger Large
Assuming the 90 days horizon Alger 35 Fund is expected to generate 0.94 times more return on investment than Alger Large. However, Alger 35 Fund is 1.06 times less risky than Alger Large. It trades about 0.21 of its potential returns per unit of risk. Alger Large Cap is currently generating about 0.19 per unit of risk. If you would invest 2,066 in Alger 35 Fund on June 2, 2025 and sell it today you would earn a total of 120.00 from holding Alger 35 Fund or generate 5.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger 35 Fund vs. Alger Large Cap
Performance |
| Timeline |
| Alger 35 Fund |
| Alger Large Cap |
Alger 35 and Alger Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger 35 and Alger Large
The main advantage of trading using opposite Alger 35 and Alger Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger 35 position performs unexpectedly, Alger Large 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 Large will offset losses from the drop in Alger Large's long position.| Alger 35 vs. Western Assets Emerging | Alger 35 vs. Doubleline Emerging Markets | Alger 35 vs. Pace International Emerging | Alger 35 vs. Dodge Cox Emerging |
| Alger Large vs. Prudential Government Money | Alger Large vs. Putnam Money Market | Alger Large vs. Matson Money Equity | Alger Large vs. Cref Money Market |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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