Correlation Between Advent Claymore and American Funds
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and American Funds 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 Advent Claymore and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and American Funds Retirement, you can compare the effects of market volatilities on Advent Claymore and American Funds 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 Advent Claymore with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and American Funds.
Diversification Opportunities for Advent Claymore and American Funds
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Advent and American is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and American Funds Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds Retirement and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds Retirement has no effect on the direction of Advent Claymore i.e., Advent Claymore and American Funds go up and down completely randomly.
Pair Corralation between Advent Claymore and American Funds
Assuming the 90 days horizon Advent Claymore Convertible is expected to generate 1.93 times more return on investment than American Funds. However, Advent Claymore is 1.93 times more volatile than American Funds Retirement. It trades about 0.15 of its potential returns per unit of risk. American Funds Retirement is currently generating about 0.26 per unit of risk. If you would invest 1,210 in Advent Claymore Convertible on May 29, 2025 and sell it today you would earn a total of 70.00 from holding Advent Claymore Convertible or generate 5.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. American Funds Retirement
Performance |
| Timeline |
| Advent Claymore Conv |
| American Funds Retirement |
Advent Claymore and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and American Funds
The main advantage of trading using opposite Advent Claymore and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, American Funds 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 Funds will offset losses from the drop in American Funds' long position.| Advent Claymore vs. Fbanjx | Advent Claymore vs. Fabwx | Advent Claymore vs. Ab Select Equity | Advent Claymore vs. Fkhemx |
| American Funds vs. Prudential Emerging Markets | American Funds vs. Fidelity New Markets | American Funds vs. Shelton Emerging Markets | American Funds vs. Ab All 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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