Correlation Between Emerging Markets and Janus Venture
Can any of the company-specific risk be diversified away by investing in both Emerging Markets and Janus Venture 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 Janus Venture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Markets Fund and Janus Venture Fund, you can compare the effects of market volatilities on Emerging Markets and Janus Venture 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 Janus Venture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Janus Venture.
Diversification Opportunities for Emerging Markets and Janus Venture
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Janus is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Fund and Janus Venture Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Venture 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 Fund are associated (or correlated) with Janus Venture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Venture has no effect on the direction of Emerging Markets i.e., Emerging Markets and Janus Venture go up and down completely randomly.
Pair Corralation between Emerging Markets and Janus Venture
Assuming the 90 days horizon Emerging Markets Fund is expected to generate 0.8 times more return on investment than Janus Venture. However, Emerging Markets Fund is 1.25 times less risky than Janus Venture. It trades about 0.07 of its potential returns per unit of risk. Janus Venture Fund is currently generating about 0.06 per unit of risk. If you would invest 1,005 in Emerging Markets Fund on September 12, 2024 and sell it today you would earn a total of 168.00 from holding Emerging Markets Fund or generate 16.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Markets Fund vs. Janus Venture Fund
Performance |
| Timeline |
| Emerging Markets |
| Janus Venture |
Emerging Markets and Janus Venture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Markets and Janus Venture
The main advantage of trading using opposite Emerging Markets and Janus Venture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Markets position performs unexpectedly, Janus Venture 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 Janus Venture will offset losses from the drop in Janus Venture's long position.| Emerging Markets vs. American Funds New | Emerging Markets vs. SCOR PK | Emerging Markets vs. Morningstar Unconstrained Allocation | Emerging Markets vs. Via Renewables |
| Janus Venture vs. Needham Aggressive Growth | Janus Venture vs. Ultramid Cap Profund Ultramid Cap | Janus Venture vs. HUMANA INC | Janus Venture vs. Barloworld Ltd ADR |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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