Correlation Between Advent Claymore and Wells Fargo
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Wells Fargo 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 Wells Fargo 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 Wells Fargo Small, you can compare the effects of market volatilities on Advent Claymore and Wells Fargo 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 Wells Fargo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Wells Fargo.
Diversification Opportunities for Advent Claymore and Wells Fargo
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Advent and Wells is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Wells Fargo Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wells Fargo Small 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 Wells Fargo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wells Fargo Small has no effect on the direction of Advent Claymore i.e., Advent Claymore and Wells Fargo go up and down completely randomly.
Pair Corralation between Advent Claymore and Wells Fargo
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 0.85 times more return on investment than Wells Fargo. However, Advent Claymore Convertible is 1.17 times less risky than Wells Fargo. It trades about 0.09 of its potential returns per unit of risk. Wells Fargo Small is currently generating about 0.06 per unit of risk. If you would invest 820.00 in Advent Claymore Convertible on September 14, 2024 and sell it today you would earn a total of 428.00 from holding Advent Claymore Convertible or generate 52.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Wells Fargo Small
Performance |
| Timeline |
| Advent Claymore Conv |
| Wells Fargo Small |
Advent Claymore and Wells Fargo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Wells Fargo
The main advantage of trading using opposite Advent Claymore and Wells Fargo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Wells Fargo 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 Wells Fargo will offset losses from the drop in Wells Fargo'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 |
| Wells Fargo vs. Virtus Convertible | Wells Fargo vs. Fidelity Sai Convertible | Wells Fargo vs. Advent Claymore Convertible | Wells Fargo vs. Rationalpier 88 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |