Correlation Between Amundi Physical and Vanguard
Can any of the company-specific risk be diversified away by investing in both Amundi Physical and Vanguard 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 Amundi Physical and Vanguard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Physical Gold and Vanguard SP 500, you can compare the effects of market volatilities on Amundi Physical and Vanguard 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 Amundi Physical with a short position of Vanguard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Physical and Vanguard.
Diversification Opportunities for Amundi Physical and Vanguard
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Amundi and Vanguard is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Physical Gold and Vanguard SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard SP 500 and Amundi Physical 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 Amundi Physical Gold are associated (or correlated) with Vanguard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard SP 500 has no effect on the direction of Amundi Physical i.e., Amundi Physical and Vanguard go up and down completely randomly.
Pair Corralation between Amundi Physical and Vanguard
Assuming the 90 days trading horizon Amundi Physical Gold is expected to generate 1.51 times more return on investment than Vanguard. However, Amundi Physical is 1.51 times more volatile than Vanguard SP 500. It trades about 0.18 of its potential returns per unit of risk. Vanguard SP 500 is currently generating about 0.2 per unit of risk. If you would invest 10,382 in Amundi Physical Gold on September 12, 2024 and sell it today you would earn a total of 398.00 from holding Amundi Physical Gold or generate 3.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Physical Gold vs. Vanguard SP 500
Performance |
| Timeline |
| Amundi Physical Gold |
| Vanguard SP 500 |
Amundi Physical and Vanguard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Physical and Vanguard
The main advantage of trading using opposite Amundi Physical and Vanguard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Physical position performs unexpectedly, Vanguard 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 Vanguard will offset losses from the drop in Vanguard's long position.| Amundi Physical vs. Amundi Index Solutions | Amundi Physical vs. Amundi MSCI World | Amundi Physical vs. Amundi Index Solutions | Amundi Physical vs. LG Russell 2000 |
| Vanguard vs. SPDR Dow Jones | Vanguard vs. iShares Core MSCI | Vanguard vs. iShares SP 500 | Vanguard vs. Vanguard FTSE All World |
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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