Correlation Between Advent Claymore and Ridgeworth Seix
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Ridgeworth Seix 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 Ridgeworth Seix 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 Ridgeworth Seix High, you can compare the effects of market volatilities on Advent Claymore and Ridgeworth Seix 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 Ridgeworth Seix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Ridgeworth Seix.
Diversification Opportunities for Advent Claymore and Ridgeworth Seix
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Advent and Ridgeworth is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Ridgeworth Seix High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ridgeworth Seix High 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 Ridgeworth Seix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ridgeworth Seix High has no effect on the direction of Advent Claymore i.e., Advent Claymore and Ridgeworth Seix go up and down completely randomly.
Pair Corralation between Advent Claymore and Ridgeworth Seix
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 3.74 times more return on investment than Ridgeworth Seix. However, Advent Claymore is 3.74 times more volatile than Ridgeworth Seix High. It trades about 0.06 of its potential returns per unit of risk. Ridgeworth Seix High is currently generating about 0.13 per unit of risk. If you would invest 881.00 in Advent Claymore Convertible on August 24, 2024 and sell it today you would earn a total of 306.00 from holding Advent Claymore Convertible or generate 34.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Ridgeworth Seix High
Performance |
| Timeline |
| Advent Claymore Conv |
| Ridgeworth Seix High |
Advent Claymore and Ridgeworth Seix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Ridgeworth Seix
The main advantage of trading using opposite Advent Claymore and Ridgeworth Seix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Ridgeworth Seix 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 Ridgeworth Seix will offset losses from the drop in Ridgeworth Seix's 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 |
| Ridgeworth Seix vs. Lord Abbett Vertible | Ridgeworth Seix vs. Columbia Vertible Securities | Ridgeworth Seix vs. Advent Claymore Convertible | Ridgeworth Seix vs. Calamos Dynamic Convertible |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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