Correlation Between Aam/himco Short and State Street
Can any of the company-specific risk be diversified away by investing in both Aam/himco Short and State Street 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 Aam/himco Short and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aamhimco Short Duration and State Street Target, you can compare the effects of market volatilities on Aam/himco Short and State Street 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 Aam/himco Short with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aam/himco Short and State Street.
Diversification Opportunities for Aam/himco Short and State Street
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aam/himco and State is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Aamhimco Short Duration and State Street Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Target and Aam/himco Short 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 Aamhimco Short Duration are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Target has no effect on the direction of Aam/himco Short i.e., Aam/himco Short and State Street go up and down completely randomly.
Pair Corralation between Aam/himco Short and State Street
Assuming the 90 days horizon Aamhimco Short Duration is expected to generate 0.05 times more return on investment than State Street. However, Aamhimco Short Duration is 19.97 times less risky than State Street. It trades about 0.25 of its potential returns per unit of risk. State Street Target is currently generating about -0.07 per unit of risk. If you would invest 998.00 in Aamhimco Short Duration on October 24, 2024 and sell it today you would earn a total of 4.00 from holding Aamhimco Short Duration or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aamhimco Short Duration vs. State Street Target
Performance |
| Timeline |
| Aamhimco Short Duration |
| State Street Target |
Aam/himco Short and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aam/himco Short and State Street
The main advantage of trading using opposite Aam/himco Short and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aam/himco Short position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Aam/himco Short vs. Vanguard Emerging Markets | Aam/himco Short vs. Boston Partners Emerging | Aam/himco Short vs. Dws Emerging Markets | Aam/himco Short vs. Mid Cap 15x Strategy |
| State Street vs. Gamco Global Gold | State Street vs. Short Precious Metals | State Street vs. Deutsche Gold Precious | State Street vs. Precious Metals And |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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