Correlation Between Applied Finance and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Applied Finance and Ashmore Emerging 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 Ashmore Emerging 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 Ashmore Emerging Markets, you can compare the effects of market volatilities on Applied Finance and Ashmore Emerging 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 Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Finance and Ashmore Emerging.
Diversification Opportunities for Applied Finance and Ashmore Emerging
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Applied and ASHMORE is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Applied Finance Explorer and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets 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 Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Applied Finance i.e., Applied Finance and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Applied Finance and Ashmore Emerging
If you would invest 2,278 in Applied Finance Explorer on August 31, 2024 and sell it today you would earn a total of 150.00 from holding Applied Finance Explorer or generate 6.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Applied Finance Explorer vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Applied Finance Explorer |
| Ashmore Emerging Markets |
Applied Finance and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Finance and Ashmore Emerging
The main advantage of trading using opposite Applied Finance and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Finance position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging's long position.| Applied Finance vs. Vanguard Small Cap Value | Applied Finance vs. Vanguard Small Cap Value | Applied Finance vs. Us Targeted Value | Applied Finance vs. Undiscovered Managers Behavioral |
| Ashmore Emerging vs. Fidelity New Markets | Ashmore Emerging vs. Fidelity New Markets | Ashmore Emerging vs. Mfs Emerging Markets |
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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