Correlation Between Applied Finance and Bbh Intermediate
Can any of the company-specific risk be diversified away by investing in both Applied Finance and Bbh Intermediate 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 Applied Finance and Bbh Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Finance Explorer and Bbh Intermediate Municipal, you can compare the effects of market volatilities on Applied Finance and Bbh Intermediate 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 Applied Finance with a short position of Bbh Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Finance and Bbh Intermediate.
Diversification Opportunities for Applied Finance and Bbh Intermediate
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Applied and Bbh is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Applied Finance Explorer and Bbh Intermediate Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bbh Intermediate Mun and Applied Finance 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 Applied Finance Explorer are associated (or correlated) with Bbh Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bbh Intermediate Mun has no effect on the direction of Applied Finance i.e., Applied Finance and Bbh Intermediate go up and down completely randomly.
Pair Corralation between Applied Finance and Bbh Intermediate
Assuming the 90 days horizon Applied Finance Explorer is expected to under-perform the Bbh Intermediate. In addition to that, Applied Finance is 5.58 times more volatile than Bbh Intermediate Municipal. It trades about -0.25 of its total potential returns per unit of risk. Bbh Intermediate Municipal is currently generating about 0.27 per unit of volatility. If you would invest 1,023 in Bbh Intermediate Municipal on November 29, 2024 and sell it today you would earn a total of 9.00 from holding Bbh Intermediate Municipal or generate 0.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Applied Finance Explorer vs. Bbh Intermediate Municipal
Performance |
| Timeline |
| Applied Finance Explorer |
| Bbh Intermediate Mun |
Applied Finance and Bbh Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Finance and Bbh Intermediate
The main advantage of trading using opposite Applied Finance and Bbh Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Finance position performs unexpectedly, Bbh Intermediate 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 Bbh Intermediate will offset losses from the drop in Bbh Intermediate's long position.| Applied Finance vs. Thrivent Small Cap | Applied Finance vs. Applied Finance Select | Applied Finance vs. Parnassus Endeavor Fund | Applied Finance vs. Queens Road Small |
| Bbh Intermediate vs. T Rowe Price | Bbh Intermediate vs. Ambrus Core Bond | Bbh Intermediate vs. Doubleline Emerging Markets | Bbh Intermediate vs. Artisan High Income |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |