Correlation Between General American and Vanguard 500
Can any of the company-specific risk be diversified away by investing in both General American and Vanguard 500 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 General American and Vanguard 500 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General American Investors and Vanguard 500 Index, you can compare the effects of market volatilities on General American and Vanguard 500 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 General American with a short position of Vanguard 500. Check out your portfolio center. Please also check ongoing floating volatility patterns of General American and Vanguard 500.
Diversification Opportunities for General American and Vanguard 500
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between General and Vanguard is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General American Investors and Vanguard 500 Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard 500 Index and General American 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 General American Investors are associated (or correlated) with Vanguard 500. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard 500 Index has no effect on the direction of General American i.e., General American and Vanguard 500 go up and down completely randomly.
Pair Corralation between General American and Vanguard 500
If you would invest 45,035 in Vanguard 500 Index on January 25, 2024 and sell it today you would earn a total of 1,782 from holding Vanguard 500 Index or generate 3.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General American Investors vs. Vanguard 500 Index
Performance |
| Timeline |
| General American Inv |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Vanguard 500 Index |
General American and Vanguard 500 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General American and Vanguard 500
The main advantage of trading using opposite General American and Vanguard 500 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General American position performs unexpectedly, Vanguard 500 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 Vanguard 500 will offset losses from the drop in Vanguard 500's long position.| General American vs. Small Pany Growth | General American vs. Rbc Microcap Value | General American vs. Fa 529 Aggressive | General American vs. Arrow Managed Futures |
| Vanguard 500 vs. Vanguard Total Stock | Vanguard 500 vs. Vanguard Mid Cap Index | Vanguard 500 vs. Vanguard Small Cap Index | Vanguard 500 vs. Vanguard Total Bond |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stocks Directory Find actively traded stocks across global markets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |