Correlation Between High-yield Municipal and Pacer Financial
Can any of the company-specific risk be diversified away by investing in both High-yield Municipal and Pacer Financial 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 Pacer Financial 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 Pacer Financial, you can compare the effects of market volatilities on High-yield Municipal and Pacer Financial 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 Pacer Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of High-yield Municipal and Pacer Financial.
Diversification Opportunities for High-yield Municipal and Pacer Financial
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between High-yield and Pacer is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Municipal Fund and Pacer Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Financial 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 Pacer Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Financial has no effect on the direction of High-yield Municipal i.e., High-yield Municipal and Pacer Financial go up and down completely randomly.
Pair Corralation between High-yield Municipal and Pacer Financial
If you would invest 824.00 in High Yield Municipal Fund on August 27, 2024 and sell it today you would earn a total of 72.00 from holding High Yield Municipal Fund or generate 8.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
High Yield Municipal Fund vs. Pacer Financial
Performance |
| Timeline |
| High Yield Municipal |
| Pacer Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
High-yield Municipal and Pacer Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High-yield Municipal and Pacer Financial
The main advantage of trading using opposite High-yield Municipal and Pacer Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High-yield Municipal position performs unexpectedly, Pacer Financial 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 Pacer Financial will offset losses from the drop in Pacer Financial'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 |
| Pacer Financial vs. Morningstar Unconstrained Allocation | Pacer Financial vs. High Yield Municipal Fund | Pacer Financial vs. Via Renewables | Pacer Financial vs. Knife River |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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