Fundamental Mutual Fund Volatility

ANCFX
 Fund
  

USD 63.38  0.00  0.00%   

We consider Fundamental Investors very steady. Fundamental Investors secures Sharpe Ratio (or Efficiency) of 0.0492, which denotes the fund had 0.0492% of return per unit of risk over the last 3 months. Our standpoint towards predicting the volatility of a fund is to use all available market data together with fund-specific technical indicators that cannot be diversified away. We have found twenty-one technical indicators for Fundamental Investors Class, which you can use to evaluate the future volatility of the entity. Please confirm Fundamental Investors Mean Deviation of 1.22, downside deviation of 1.38, and Coefficient Of Variation of 14287.72 to check if the risk estimate we provide is consistent with the expected return of 0.0769%.
  
Fundamental Investors Mutual Fund volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Fundamental daily returns, and it is calculated using variance and standard deviation. We also use Fundamental's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Fundamental Investors volatility.

360 Days Market Risk

Very steady

Chance of Distress

Very Small

360 Days Economic Sensitivity

Moves indifferently to market moves
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Fundamental Investors can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Fundamental Investors at lower prices. For example, an investor can purchase Fundamental stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Fundamental Investors' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Fundamental Investors

+0.97VSTSXVanguard Total StockPairCorr
+0.9VTSAXVanguard Total StockPairCorr
+0.97VSMPXVanguard Total StockPairCorr
+0.9VTSMXVanguard Index TrustPairCorr
+0.97VITSXVanguard Index TrustPairCorr
+0.9VFINXVanguard Index Trust Low VolatilityPairCorr
+0.97VFFSXVanguard 500 Index Low VolatilityPairCorr

Moving against Fundamental Investors

-0.87GPMFXGuidepath Managed FuturesPairCorr
-0.85PQTNXPimco Trends ManagedPairCorr
-0.85PQTAXPimco Trends ManagedPairCorr

Fundamental Investors Market Sensitivity And Downside Risk

Fundamental Investors' beta coefficient measures the volatility of Fundamental mutual fund compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Fundamental mutual fund's returns against your selected market. In other words, Fundamental Investors's beta of -0.0043 provides an investor with an approximation of how much risk Fundamental Investors mutual fund can potentially add to one of your existing portfolios.
Fundamental Investors Class has relatively low volatility with skewness of 0.42 and kurtosis of 0.97. However, we advise all investors to independently investigate Fundamental Investors Class to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Fundamental Investors' mutual fund risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Fundamental Investors' mutual fund price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
3 Months Beta |Analyze Fundamental Investors Demand Trend
Check current 90 days Fundamental Investors correlation with market (DOW)

Fundamental Beta

    
  -0.0043  
Fundamental standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  1.56  
It is essential to understand the difference between upside risk (as represented by Fundamental Investors's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Fundamental Investors' daily returns or price. Since the actual investment returns on holding a position in fundamental mutual fund tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Fundamental Investors.

Fundamental Investors Mutual Fund Volatility Analysis

Volatility refers to the frequency at which Fundamental Investors fund price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Fundamental Investors' price changes. Investors will then calculate the volatility of Fundamental Investors' mutual fund to predict their future moves. A fund that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A mutual fund with relatively stable price changes has low volatility. A highly volatile fund is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Fundamental Investors' volatility:

Historical Volatility

This type of fund volatility measures Fundamental Investors' fluctuations based on previous trends. It's commonly used to predict Fundamental Investors' future behavior based on its past. However, it cannot conclusively determine the future direction of the mutual fund.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Fundamental Investors' current market price. This means that the fund will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Fundamental Investors' to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. The Median Price line plots median indexes of Fundamental Investors price series.
.

Fundamental Investors Projected Return Density Against Market

Assuming the 90 days horizon Fundamental Investors Class has a beta of -0.0043 . This suggests as returns on benchmark increase, returns on holding Fundamental Investors are expected to decrease at a much lower rate. During the bear market, however, Fundamental Investors Class is likely to outperform the market.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Fundamental Investors or American Funds sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Fundamental Investors' price will be affected by overall mutual fund market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Fundamental fund's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.0012, implying that it can generate a 0.0012 percent excess return over DOW after adjusting for the inherited market risk (beta).
   Predicted Return Density   
       Returns  
Fundamental Investors' volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how fundamental mutual fund's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Fundamental Investors Price Volatility?

Several factors can influence a Fund's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Fundamental Investors Mutual Fund Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Fundamental Investors or American Funds sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Fundamental Investors' price will be affected by overall mutual fund market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Fundamental fund's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Assuming the 90 days horizon the coefficient of variation of Fundamental Investors is 2031.09. The daily returns are distributed with a variance of 2.44 and standard deviation of 1.56. The mean deviation of Fundamental Investors Class is currently at 1.21. For similar time horizon, the selected benchmark (DOW) has volatility of 1.42
α
Alpha over DOW
0.0012
β
Beta against DOW-0.0043
σ
Overall volatility
1.56
Ir
Information ratio -0.02

Fundamental Investors Mutual Fund Return Volatility

Fundamental Investors historical daily return volatility represents how much of Fundamental Investors fund's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The fund shows 1.5611% volatility of returns over 90 . By contrast, DOW inherits 1.3867% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
       Timeline  

About Fundamental Investors Volatility

Volatility is a rate at which the price of Fundamental Investors or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Fundamental Investors may increase or decrease. In other words, similar to Fundamental's beta indicator, it measures the risk of Fundamental Investors and helps estimate the fluctuations that may happen in a short period of time. So if prices of Fundamental Investors fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

Fundamental Investors Investment Opportunity

Fundamental Investors Class has a volatility of 1.56 and is 1.12 times more volatile than DOW. 13  of all equities and portfolios are less risky than Fundamental Investors. Compared to the overall equity markets, volatility of historical daily returns of Fundamental Investors Class is lower than 13 () of all global equities and portfolios over the last 90 days. Use Fundamental Investors Class to protect your portfolios against small market fluctuations. Benchmarks are essential to demonstrate the utility of optimization algorithms. The mutual fund experiences a normal downward trend, but the immediate impact on correlations cannot be determined at the moment . Check odds of Fundamental Investors to be traded at $62.75 in 90 days.

Fundamental Investors Additional Risk Indicators

The analysis of Fundamental Investors' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Fundamental Investors' investment and either accepting that risk or mitigating it. Along with some common measures of Fundamental Investors mutual fund's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential mutual funds, we recommend comparing similar funds with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Fundamental Investors Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Fundamental Investors as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Fundamental Investors' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Fundamental Investors' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Fundamental Investors Class.
Please continue to Trending Equities. Note that the Fundamental Investors information on this page should be used as a complementary analysis to other Fundamental Investors' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

Complementary Tools for Fundamental Mutual Fund analysis

When running Fundamental Investors price analysis, check to measure Fundamental Investors' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Fundamental Investors is operating at the current time. Most of Fundamental Investors' value examination focuses on studying past and present price action to predict the probability of Fundamental Investors' future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Fundamental Investors' price. Additionally, you may evaluate how the addition of Fundamental Investors to your portfolios can decrease your overall portfolio volatility.
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Please note, there is a significant difference between Fundamental Investors' value and its price as these two are different measures arrived at by different means. Investors typically determine Fundamental Investors value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Fundamental Investors' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.