Correlation Between Advent Claymore and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Emerging Markets 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 Advent Claymore and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Emerging Markets Fund, you can compare the effects of market volatilities on Advent Claymore and Emerging Markets 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 Advent Claymore with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Emerging Markets.
Diversification Opportunities for Advent Claymore and Emerging Markets
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Advent and Emerging is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Emerging Markets Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets has no effect on the direction of Advent Claymore i.e., Advent Claymore and Emerging Markets go up and down completely randomly.
Pair Corralation between Advent Claymore and Emerging Markets
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 1.16 times more return on investment than Emerging Markets. However, Advent Claymore is 1.16 times more volatile than Emerging Markets Fund. It trades about 0.08 of its potential returns per unit of risk. Emerging Markets Fund is currently generating about 0.05 per unit of risk. If you would invest 828.00 in Advent Claymore Convertible on September 12, 2024 and sell it today you would earn a total of 408.00 from holding Advent Claymore Convertible or generate 49.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Emerging Markets Fund
Performance |
| Timeline |
| Advent Claymore Conv |
| Emerging Markets |
Advent Claymore and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Emerging Markets
The main advantage of trading using opposite Advent Claymore and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
| Emerging Markets vs. Qs Moderate Growth | Emerging Markets vs. T Rowe Price | Emerging Markets vs. Mid Cap Growth | Emerging Markets vs. Small Pany 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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