Correlation Between 361 Global and Swan Defined
Can any of the company-specific risk be diversified away by investing in both 361 Global and Swan Defined 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 361 Global and Swan Defined into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 361 Global Longshort and Swan Defined Risk, you can compare the effects of market volatilities on 361 Global and Swan Defined 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 361 Global with a short position of Swan Defined. Check out your portfolio center. Please also check ongoing floating volatility patterns of 361 Global and Swan Defined.
Diversification Opportunities for 361 Global and Swan Defined
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 361 and Swan is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding 361 Global Longshort and Swan Defined Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swan Defined Risk and 361 Global 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 361 Global Longshort are associated (or correlated) with Swan Defined. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swan Defined Risk has no effect on the direction of 361 Global i.e., 361 Global and Swan Defined go up and down completely randomly.
Pair Corralation between 361 Global and Swan Defined
Assuming the 90 days horizon 361 Global is expected to generate 2.8 times less return on investment than Swan Defined. In addition to that, 361 Global is 1.02 times more volatile than Swan Defined Risk. It trades about 0.11 of its total potential returns per unit of risk. Swan Defined Risk is currently generating about 0.3 per unit of volatility. If you would invest 1,542 in Swan Defined Risk on September 5, 2024 and sell it today you would earn a total of 46.00 from holding Swan Defined Risk or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
361 Global Longshort vs. Swan Defined Risk
Performance |
| Timeline |
| 361 Global Longshort |
| Swan Defined Risk |
361 Global and Swan Defined Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 361 Global and Swan Defined
The main advantage of trading using opposite 361 Global and Swan Defined positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 361 Global position performs unexpectedly, Swan Defined 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 Swan Defined will offset losses from the drop in Swan Defined's long position.| 361 Global vs. Swan Defined Risk | 361 Global vs. Boston Partners Longshort | 361 Global vs. 361 Global Longshort | 361 Global vs. Aqr Long Short Equity |
| Swan Defined vs. Swan Defined Risk | Swan Defined vs. Swan Defined Risk | Swan Defined vs. Swan Defined Risk | Swan Defined vs. Swan Defined Risk |
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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