Correlation Between Needham Aggressive and Touchstone International
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Touchstone International 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 Needham Aggressive and Touchstone International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Touchstone International Equity, you can compare the effects of market volatilities on Needham Aggressive and Touchstone International 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 Needham Aggressive with a short position of Touchstone International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Touchstone International.
Diversification Opportunities for Needham Aggressive and Touchstone International
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Needham and Touchstone is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Touchstone International Equit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone International and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Touchstone International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone International has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Touchstone International go up and down completely randomly.
Pair Corralation between Needham Aggressive and Touchstone International
Assuming the 90 days horizon Needham Aggressive Growth is expected to generate 1.77 times more return on investment than Touchstone International. However, Needham Aggressive is 1.77 times more volatile than Touchstone International Equity. It trades about 0.11 of its potential returns per unit of risk. Touchstone International Equity is currently generating about 0.14 per unit of risk. If you would invest 4,527 in Needham Aggressive Growth on May 30, 2025 and sell it today you would earn a total of 1,290 from holding Needham Aggressive Growth or generate 28.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Touchstone International Equit
Performance |
| Timeline |
| Needham Aggressive Growth |
| Touchstone International |
Needham Aggressive and Touchstone International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Touchstone International
The main advantage of trading using opposite Needham Aggressive and Touchstone International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Touchstone International 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 Touchstone International will offset losses from the drop in Touchstone International's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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