Correlation Between Shelton Funds and American Century
Can any of the company-specific risk be diversified away by investing in both Shelton Funds and American Century 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 Shelton Funds and American Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shelton Funds and American Century Diversified, you can compare the effects of market volatilities on Shelton Funds and American Century 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 Shelton Funds with a short position of American Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Funds and American Century.
Diversification Opportunities for Shelton Funds and American Century
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shelton and American is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Funds and American Century Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Century Div and Shelton Funds 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 Shelton Funds are associated (or correlated) with American Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Century Div has no effect on the direction of Shelton Funds i.e., Shelton Funds and American Century go up and down completely randomly.
Pair Corralation between Shelton Funds and American Century
Assuming the 90 days horizon Shelton Funds is expected to generate 4.38 times more return on investment than American Century. However, Shelton Funds is 4.38 times more volatile than American Century Diversified. It trades about 0.11 of its potential returns per unit of risk. American Century Diversified is currently generating about 0.14 per unit of risk. If you would invest 4,344 in Shelton Funds on August 19, 2025 and sell it today you would earn a total of 311.00 from holding Shelton Funds or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelton Funds vs. American Century Diversified
Performance |
| Timeline |
| Shelton Funds |
| American Century Div |
Shelton Funds and American Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Funds and American Century
The main advantage of trading using opposite Shelton Funds and American Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Funds position performs unexpectedly, American Century 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 American Century will offset losses from the drop in American Century's long position.| Shelton Funds vs. Shelton Emerging Markets | Shelton Funds vs. Shelton Emerging Markets | Shelton Funds vs. California Tax Free Income | Shelton Funds vs. Nasdaq 100 Index Fund |
| American Century vs. Mfs Diversified Income | American Century vs. Guidepath Conservative Income | American Century vs. Stone Ridge Diversified | American Century vs. Federated Hermes Conservative |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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