Correlation Between Amundi Index and WisdomTree Natural
Can any of the company-specific risk be diversified away by investing in both Amundi Index and WisdomTree Natural 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 Amundi Index and WisdomTree Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Index Solutions and WisdomTree Natural Gas, you can compare the effects of market volatilities on Amundi Index and WisdomTree Natural 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 Amundi Index with a short position of WisdomTree Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Index and WisdomTree Natural.
Diversification Opportunities for Amundi Index and WisdomTree Natural
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amundi and WisdomTree is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Index Solutions and WisdomTree Natural Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Natural Gas and Amundi Index 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 Amundi Index Solutions are associated (or correlated) with WisdomTree Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Natural Gas has no effect on the direction of Amundi Index i.e., Amundi Index and WisdomTree Natural go up and down completely randomly.
Pair Corralation between Amundi Index and WisdomTree Natural
Assuming the 90 days trading horizon Amundi Index Solutions is expected to generate 0.34 times more return on investment than WisdomTree Natural. However, Amundi Index Solutions is 2.96 times less risky than WisdomTree Natural. It trades about 0.05 of its potential returns per unit of risk. WisdomTree Natural Gas is currently generating about -0.06 per unit of risk. If you would invest 297,400 in Amundi Index Solutions on September 2, 2024 and sell it today you would earn a total of 19,375 from holding Amundi Index Solutions or generate 6.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Index Solutions vs. WisdomTree Natural Gas
Performance |
| Timeline |
| Amundi Index Solutions |
| WisdomTree Natural Gas |
Amundi Index and WisdomTree Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Index and WisdomTree Natural
The main advantage of trading using opposite Amundi Index and WisdomTree Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Index position performs unexpectedly, WisdomTree Natural 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 WisdomTree Natural will offset losses from the drop in WisdomTree Natural's long position.| Amundi Index vs. Amundi EUR High | Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi MSCI Pacific | Amundi Index vs. Amundi MSCI Europe |
| WisdomTree Natural vs. Vanguard FTSE Developed | WisdomTree Natural vs. Leverage Shares 2x | WisdomTree Natural vs. Amundi Index Solutions | WisdomTree Natural vs. Amundi Index Solutions |
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 CEOs Directory module to screen CEOs from public companies around the world.
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