Correlation Between Advent Claymore and Vanguard Short-term
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Vanguard Short-term 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 Vanguard Short-term 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 Vanguard Short Term Tax Exempt, you can compare the effects of market volatilities on Advent Claymore and Vanguard Short-term 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 Vanguard Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Vanguard Short-term.
Diversification Opportunities for Advent Claymore and Vanguard Short-term
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Advent and Vanguard is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Vanguard Short Term Tax Exempt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Short Term 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 Vanguard Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Short Term has no effect on the direction of Advent Claymore i.e., Advent Claymore and Vanguard Short-term go up and down completely randomly.
Pair Corralation between Advent Claymore and Vanguard Short-term
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 13.06 times more return on investment than Vanguard Short-term. However, Advent Claymore is 13.06 times more volatile than Vanguard Short Term Tax Exempt. It trades about 0.12 of its potential returns per unit of risk. Vanguard Short Term Tax Exempt is currently generating about 0.26 per unit of risk. If you would invest 1,057 in Advent Claymore Convertible on September 1, 2024 and sell it today you would earn a total of 161.00 from holding Advent Claymore Convertible or generate 15.23% 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. Vanguard Short Term Tax Exempt
Performance |
| Timeline |
| Advent Claymore Conv |
| Vanguard Short Term |
Advent Claymore and Vanguard Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Vanguard Short-term
The main advantage of trading using opposite Advent Claymore and Vanguard Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Vanguard Short-term 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 Vanguard Short-term will offset losses from the drop in Vanguard Short-term'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 |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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