Correlation Between Astor Long/short and Us Government
Can any of the company-specific risk be diversified away by investing in both Astor Long/short and Us Government 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 Astor Long/short and Us Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astor Longshort Fund and Us Government Plus, you can compare the effects of market volatilities on Astor Long/short and Us Government 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 Astor Long/short with a short position of Us Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astor Long/short and Us Government.
Diversification Opportunities for Astor Long/short and Us Government
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Astor and GVPSX is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund and Us Government Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Government Plus and Astor Long/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 Astor Longshort Fund are associated (or correlated) with Us Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Government Plus has no effect on the direction of Astor Long/short i.e., Astor Long/short and Us Government go up and down completely randomly.
Pair Corralation between Astor Long/short and Us Government
Assuming the 90 days horizon Astor Longshort Fund is expected to generate 0.44 times more return on investment than Us Government. However, Astor Longshort Fund is 2.29 times less risky than Us Government. It trades about 0.04 of its potential returns per unit of risk. Us Government Plus is currently generating about -0.03 per unit of risk. If you would invest 1,159 in Astor Longshort Fund on October 7, 2024 and sell it today you would earn a total of 121.00 from holding Astor Longshort Fund or generate 10.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astor Longshort Fund vs. Us Government Plus
Performance |
| Timeline |
| Astor Long/short |
| Us Government Plus |
Astor Long/short and Us Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astor Long/short and Us Government
The main advantage of trading using opposite Astor Long/short and Us Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astor Long/short position performs unexpectedly, Us Government 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 Us Government will offset losses from the drop in Us Government's long position.| Astor Long/short vs. Ab Small Cap | Astor Long/short vs. Vy Columbia Small | Astor Long/short vs. Sp Smallcap 600 | Astor Long/short vs. Glg Intl Small |
| Us Government vs. Salient Mlp Energy | Us Government vs. World Energy Fund | Us Government vs. Clearbridge Energy Mlp | Us Government vs. Pimco Energy Tactical |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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