Correlation Between Emerging Markets and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Emerging Markets and Bny Mellon 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 Emerging Markets and Bny Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Markets Small and Bny Mellon Mid, you can compare the effects of market volatilities on Emerging Markets and Bny Mellon 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 Emerging Markets with a short position of Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Bny Mellon.
Diversification Opportunities for Emerging Markets and Bny Mellon
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Bny is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Small and Bny Mellon Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Mid and Emerging Markets 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 Emerging Markets Small are associated (or correlated) with Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Mid has no effect on the direction of Emerging Markets i.e., Emerging Markets and Bny Mellon go up and down completely randomly.
Pair Corralation between Emerging Markets and Bny Mellon
Assuming the 90 days horizon Emerging Markets Small is expected to generate 0.67 times more return on investment than Bny Mellon. However, Emerging Markets Small is 1.48 times less risky than Bny Mellon. It trades about 0.06 of its potential returns per unit of risk. Bny Mellon Mid is currently generating about 0.03 per unit of risk. If you would invest 1,212 in Emerging Markets Small on September 3, 2024 and sell it today you would earn a total of 273.00 from holding Emerging Markets Small or generate 22.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Markets Small vs. Bny Mellon Mid
Performance |
| Timeline |
| Emerging Markets Small |
| Bny Mellon Mid |
Emerging Markets and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Markets and Bny Mellon
The main advantage of trading using opposite Emerging Markets and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Markets position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Emerging Markets vs. Nationwide Growth Fund | Emerging Markets vs. Qs Growth Fund | Emerging Markets vs. Rational Defensive Growth | Emerging Markets vs. Chase Growth Fund |
| Bny Mellon vs. Bny Mellon Small | Bny Mellon vs. Bny Mellon International | Bny Mellon vs. Bny Mellon Emerging | Bny Mellon vs. Invesco Disciplined Equity |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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