Correlation Between Scharf Fund and Scharf Global
Can any of the company-specific risk be diversified away by investing in both Scharf Fund and Scharf Global 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 Scharf Fund and Scharf Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scharf Fund Retail and Scharf Global Opportunity, you can compare the effects of market volatilities on Scharf Fund and Scharf Global 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 Scharf Fund with a short position of Scharf Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scharf Fund and Scharf Global.
Diversification Opportunities for Scharf Fund and Scharf Global
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Scharf and Scharf is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Scharf Fund Retail and Scharf Global Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scharf Global Opportunity and Scharf Fund 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 Scharf Fund Retail are associated (or correlated) with Scharf Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scharf Global Opportunity has no effect on the direction of Scharf Fund i.e., Scharf Fund and Scharf Global go up and down completely randomly.
Pair Corralation between Scharf Fund and Scharf Global
Assuming the 90 days horizon Scharf Fund Retail is expected to under-perform the Scharf Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, Scharf Fund Retail is 1.01 times less risky than Scharf Global. The mutual fund trades about -0.27 of its potential returns per unit of risk. The Scharf Global Opportunity is currently generating about -0.25 of returns per unit of risk over similar time horizon. If you would invest 3,521 in Scharf Global Opportunity on January 30, 2024 and sell it today you would lose (111.00) from holding Scharf Global Opportunity or give up 3.15% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Scharf Fund Retail vs. Scharf Global Opportunity
Performance |
Timeline |
Scharf Fund Retail |
Scharf Global Opportunity |
Scharf Fund and Scharf Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Scharf Fund and Scharf Global
The main advantage of trading using opposite Scharf Fund and Scharf Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scharf Fund position performs unexpectedly, Scharf Global 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 Scharf Global will offset losses from the drop in Scharf Global's long position.Scharf Fund vs. Calvert Equity Portfolio | Scharf Fund vs. Calvert Small Cap | Scharf Fund vs. Calvert Large Cap | Scharf Fund vs. Calvert Balanced Portfolio |
Scharf Global vs. Global Diversified Income | Scharf Global vs. Tax Free Conservative Income | Scharf Global vs. Wilmington Diversified Income | Scharf Global vs. Calvert Conservative Allocation |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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