Correlation Between Amundi Index and Invesco Markets
Can any of the company-specific risk be diversified away by investing in both Amundi Index and Invesco Markets 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 Invesco Markets 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 Invesco Markets II, you can compare the effects of market volatilities on Amundi Index and Invesco Markets 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 Invesco Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Index and Invesco Markets.
Diversification Opportunities for Amundi Index and Invesco Markets
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amundi and Invesco is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Index Solutions and Invesco Markets II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Markets II 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 Invesco Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Markets II has no effect on the direction of Amundi Index i.e., Amundi Index and Invesco Markets go up and down completely randomly.
Pair Corralation between Amundi Index and Invesco Markets
Assuming the 90 days trading horizon Amundi Index Solutions is expected to generate 0.66 times more return on investment than Invesco Markets. However, Amundi Index Solutions is 1.52 times less risky than Invesco Markets. It trades about 0.04 of its potential returns per unit of risk. Invesco Markets II is currently generating about -0.06 per unit of risk. If you would invest 3,392 in Amundi Index Solutions on August 26, 2024 and sell it today you would earn a total of 615.00 from holding Amundi Index Solutions or generate 18.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Index Solutions vs. Invesco Markets II
Performance |
| Timeline |
| Amundi Index Solutions |
| Invesco Markets II |
Amundi Index and Invesco Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Index and Invesco Markets
The main advantage of trading using opposite Amundi Index and Invesco Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Index position performs unexpectedly, Invesco Markets 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 Invesco Markets will offset losses from the drop in Invesco Markets' 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 |
| Invesco Markets vs. Vanguard FTSE Developed | Invesco Markets vs. Leverage Shares 2x | Invesco Markets vs. Amundi Index Solutions | Invesco Markets 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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