Correlation Between Atac Inflation and Federated Government
Can any of the company-specific risk be diversified away by investing in both Atac Inflation and Federated 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 Atac Inflation and Federated Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atac Inflation Rotation and Federated Government Income, you can compare the effects of market volatilities on Atac Inflation and Federated 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 Atac Inflation with a short position of Federated Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atac Inflation and Federated Government.
Diversification Opportunities for Atac Inflation and Federated Government
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atac and FEDERATED is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Atac Inflation Rotation and Federated Government Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Government and Atac Inflation 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 Atac Inflation Rotation are associated (or correlated) with Federated Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Government has no effect on the direction of Atac Inflation i.e., Atac Inflation and Federated Government go up and down completely randomly.
Pair Corralation between Atac Inflation and Federated Government
Assuming the 90 days horizon Atac Inflation Rotation is expected to generate 2.74 times more return on investment than Federated Government. However, Atac Inflation is 2.74 times more volatile than Federated Government Income. It trades about 0.24 of its potential returns per unit of risk. Federated Government Income is currently generating about 0.32 per unit of risk. If you would invest 3,200 in Atac Inflation Rotation on December 3, 2024 and sell it today you would earn a total of 141.00 from holding Atac Inflation Rotation or generate 4.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atac Inflation Rotation vs. Federated Government Income
Performance |
| Timeline |
| Atac Inflation Rotation |
| Federated Government |
Atac Inflation and Federated Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atac Inflation and Federated Government
The main advantage of trading using opposite Atac Inflation and Federated Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atac Inflation position performs unexpectedly, Federated 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 Federated Government will offset losses from the drop in Federated Government's long position.| Atac Inflation vs. ATAC Rotation ETF | Atac Inflation vs. Tidal ETF Trust | Atac Inflation vs. Quadratic Interest Rate | Atac Inflation vs. Baron Global Advantage |
| Federated Government vs. City National Rochdale | Federated Government vs. Pace High Yield | Federated Government vs. Calvert High Yield | Federated Government vs. Multi Manager High Yield |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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