Correlation Between Advent Claymore and Amg Gwk
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Amg Gwk 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 Amg Gwk 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 Amg Gwk Municipal, you can compare the effects of market volatilities on Advent Claymore and Amg Gwk 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 Amg Gwk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Amg Gwk.
Diversification Opportunities for Advent Claymore and Amg Gwk
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Advent and Amg is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Amg Gwk Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Gwk Municipal 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 Amg Gwk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Gwk Municipal has no effect on the direction of Advent Claymore i.e., Advent Claymore and Amg Gwk go up and down completely randomly.
Pair Corralation between Advent Claymore and Amg Gwk
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 2.99 times more return on investment than Amg Gwk. However, Advent Claymore is 2.99 times more volatile than Amg Gwk Municipal. It trades about 0.07 of its potential returns per unit of risk. Amg Gwk Municipal is currently generating about 0.07 per unit of risk. If you would invest 867.00 in Advent Claymore Convertible on September 3, 2024 and sell it today you would earn a total of 351.00 from holding Advent Claymore Convertible or generate 40.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Amg Gwk Municipal
Performance |
| Timeline |
| Advent Claymore Conv |
| Amg Gwk Municipal |
Advent Claymore and Amg Gwk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Amg Gwk
The main advantage of trading using opposite Advent Claymore and Amg Gwk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Amg Gwk 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 Amg Gwk will offset losses from the drop in Amg Gwk's long position.| Advent Claymore vs. Tekla Healthcare Investors | Advent Claymore vs. Tekla Life Sciences | Advent Claymore vs. Cohen Steers Reit | Advent Claymore vs. XAI Octagon Floating |
| Amg Gwk vs. Ab High Income | Amg Gwk vs. Vanguard Star Fund | Amg Gwk vs. Artisan High Income | Amg Gwk vs. Ab Global Risk |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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