Correlation Between AltShares Trust and EA Series
Can any of the company-specific risk be diversified away by investing in both AltShares Trust and EA Series 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 AltShares Trust and EA Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AltShares Trust and EA Series Trust, you can compare the effects of market volatilities on AltShares Trust and EA Series 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 AltShares Trust with a short position of EA Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of AltShares Trust and EA Series.
Diversification Opportunities for AltShares Trust and EA Series
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AltShares and DRAI is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding AltShares Trust and EA Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EA Series Trust and AltShares Trust 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 AltShares Trust are associated (or correlated) with EA Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EA Series Trust has no effect on the direction of AltShares Trust i.e., AltShares Trust and EA Series go up and down completely randomly.
Pair Corralation between AltShares Trust and EA Series
Considering the 90-day investment horizon AltShares Trust is expected to generate 0.35 times more return on investment than EA Series. However, AltShares Trust is 2.85 times less risky than EA Series. It trades about -0.02 of its potential returns per unit of risk. EA Series Trust is currently generating about -0.08 per unit of risk. If you would invest 2,793 in AltShares Trust on August 30, 2024 and sell it today you would lose (3.00) from holding AltShares Trust or give up 0.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
AltShares Trust vs. EA Series Trust
Performance |
| Timeline |
| AltShares Trust |
| EA Series Trust |
AltShares Trust and EA Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AltShares Trust and EA Series
The main advantage of trading using opposite AltShares Trust and EA Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AltShares Trust position performs unexpectedly, EA Series 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 EA Series will offset losses from the drop in EA Series' long position.| AltShares Trust vs. Albany International | AltShares Trust vs. Acadia Realty Trust | AltShares Trust vs. AptarGroup | AltShares Trust vs. Applied Industrial Technologies |
| EA Series vs. Vanguard Total Stock | EA Series vs. SPDR SP 500 | EA Series vs. iShares Core SP | EA Series vs. Vanguard Total Bond |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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