Correlation Between High-yield Municipal and Invesco Electric
Can any of the company-specific risk be diversified away by investing in both High-yield Municipal and Invesco Electric 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 High-yield Municipal and Invesco Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Yield Municipal Fund and Invesco Electric Vehicle, you can compare the effects of market volatilities on High-yield Municipal and Invesco Electric 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 High-yield Municipal with a short position of Invesco Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of High-yield Municipal and Invesco Electric.
Diversification Opportunities for High-yield Municipal and Invesco Electric
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between High-yield and Invesco is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Municipal Fund and Invesco Electric Vehicle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Electric Vehicle and High-yield Municipal 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 High Yield Municipal Fund are associated (or correlated) with Invesco Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Electric Vehicle has no effect on the direction of High-yield Municipal i.e., High-yield Municipal and Invesco Electric go up and down completely randomly.
Pair Corralation between High-yield Municipal and Invesco Electric
Assuming the 90 days horizon High Yield Municipal Fund is expected to generate 0.23 times more return on investment than Invesco Electric. However, High Yield Municipal Fund is 4.26 times less risky than Invesco Electric. It trades about 0.07 of its potential returns per unit of risk. Invesco Electric Vehicle is currently generating about -0.06 per unit of risk. If you would invest 812.00 in High Yield Municipal Fund on August 30, 2024 and sell it today you would earn a total of 87.00 from holding High Yield Municipal Fund or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Yield Municipal Fund vs. Invesco Electric Vehicle
Performance |
| Timeline |
| High Yield Municipal |
| Invesco Electric Vehicle |
High-yield Municipal and Invesco Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High-yield Municipal and Invesco Electric
The main advantage of trading using opposite High-yield Municipal and Invesco Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High-yield Municipal position performs unexpectedly, Invesco Electric 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 Electric will offset losses from the drop in Invesco Electric's long position.| High-yield Municipal vs. High Yield Fund Investor | High-yield Municipal vs. Intermediate Term Tax Free Bond | High-yield Municipal vs. California High Yield Municipal | High-yield Municipal vs. T Rowe Price |
| Invesco Electric vs. iShares Silver Trust | Invesco Electric vs. VanEck Gold Miners | Invesco Electric vs. SPDR SP 500 | Invesco Electric vs. United States Oil |
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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