Correlation Between Invesco Asia and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Invesco Asia 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 Invesco Asia and Ashmore Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Asia Pacific and Ashmore Emerging Markets, you can compare the effects of market volatilities on Invesco Asia 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 Invesco Asia with a short position of Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Asia and Ashmore Emerging.
Diversification Opportunities for Invesco Asia and Ashmore Emerging
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Invesco and Ashmore is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Asia Pacific 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 Invesco Asia 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 Invesco Asia Pacific 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 Invesco Asia i.e., Invesco Asia and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Invesco Asia and Ashmore Emerging
If you would invest (100.00) in Ashmore Emerging Markets on November 3, 2024 and sell it today you would earn a total of 100.00 from holding Ashmore Emerging Markets or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Invesco Asia Pacific vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Invesco Asia Pacific |
| Ashmore Emerging Markets |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Invesco Asia and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Asia and Ashmore Emerging
The main advantage of trading using opposite Invesco Asia and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Asia 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.| Invesco Asia vs. Lord Abbett Diversified | Invesco Asia vs. Delaware Limited Term Diversified | Invesco Asia vs. Madison Diversified Income | Invesco Asia vs. Guidepath Conservative Income |
| Ashmore Emerging vs. American Beacon The | Ashmore Emerging vs. Invesco Small Cap | Ashmore Emerging vs. Invesco Asia Pacific | Ashmore Emerging vs. Invesco European Growth |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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