Correlation Between Hennessy Large and Pcm Fund
Can any of the company-specific risk be diversified away by investing in both Hennessy Large and Pcm 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 Hennessy Large and Pcm Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hennessy Large Cap and Pcm Fund, you can compare the effects of market volatilities on Hennessy Large and Pcm 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 Hennessy Large with a short position of Pcm Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hennessy Large and Pcm Fund.
Diversification Opportunities for Hennessy Large and Pcm Fund
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hennessy and Pcm is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Hennessy Large Cap and Pcm Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pcm Fund and Hennessy Large 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 Hennessy Large Cap are associated (or correlated) with Pcm Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pcm Fund has no effect on the direction of Hennessy Large i.e., Hennessy Large and Pcm Fund go up and down completely randomly.
Pair Corralation between Hennessy Large and Pcm Fund
Assuming the 90 days horizon Hennessy Large Cap is expected to under-perform the Pcm Fund. In addition to that, Hennessy Large is 1.4 times more volatile than Pcm Fund. It trades about -0.02 of its total potential returns per unit of risk. Pcm Fund is currently generating about 0.04 per unit of volatility. If you would invest 611.00 in Pcm Fund on August 16, 2025 and sell it today you would earn a total of 11.00 from holding Pcm Fund or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hennessy Large Cap vs. Pcm Fund
Performance |
| Timeline |
| Hennessy Large Cap |
| Pcm Fund |
Hennessy Large and Pcm Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hennessy Large and Pcm Fund
The main advantage of trading using opposite Hennessy Large and Pcm Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hennessy Large position performs unexpectedly, Pcm 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 Pcm Fund will offset losses from the drop in Pcm Fund's long position.| Hennessy Large vs. Schwab Target 2015 | Hennessy Large vs. North Star Dividend | Hennessy Large vs. Consumer Services Ultrasector | Hennessy Large vs. Sextant Growth Fund |
| Pcm Fund vs. Hennessy Bp Midstream | Pcm Fund vs. Ariel Focus Fund | Pcm Fund vs. Invesco High Income | Pcm Fund vs. Amg Frontier Small |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |