Correlation Between Astor Long/short and Invesco High
Can any of the company-specific risk be diversified away by investing in both Astor Long/short and Invesco High 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 Invesco High 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 Invesco High Yield, you can compare the effects of market volatilities on Astor Long/short and Invesco High 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 Invesco High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astor Long/short and Invesco High.
Diversification Opportunities for Astor Long/short and Invesco High
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Astor and Invesco is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund and Invesco High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco High Yield 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 Invesco High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco High Yield has no effect on the direction of Astor Long/short i.e., Astor Long/short and Invesco High go up and down completely randomly.
Pair Corralation between Astor Long/short and Invesco High
Assuming the 90 days horizon Astor Longshort Fund is expected to generate 2.33 times more return on investment than Invesco High. However, Astor Long/short is 2.33 times more volatile than Invesco High Yield. It trades about 0.49 of its potential returns per unit of risk. Invesco High Yield is currently generating about 0.25 per unit of risk. If you would invest 1,380 in Astor Longshort Fund on September 4, 2024 and sell it today you would earn a total of 51.00 from holding Astor Longshort Fund or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Astor Longshort Fund vs. Invesco High Yield
Performance |
| Timeline |
| Astor Long/short |
| Invesco High Yield |
Astor Long/short and Invesco High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astor Long/short and Invesco High
The main advantage of trading using opposite Astor Long/short and Invesco High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astor Long/short position performs unexpectedly, Invesco High 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 Invesco High will offset losses from the drop in Invesco High's long position.| Astor Long/short vs. Virtus Seix Government | Astor Long/short vs. Dunham Porategovernment Bond | Astor Long/short vs. Dreyfus Government Cash | Astor Long/short vs. Dws Government Money |
| Invesco High vs. Transamerica Emerging Markets | Invesco High vs. Angel Oak Multi Strategy | Invesco High vs. Ep Emerging Markets | Invesco High vs. The Emerging Markets |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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