Correlation Between Avantis Small and Harbor ETF
Can any of the company-specific risk be diversified away by investing in both Avantis Small and Harbor ETF 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 Avantis Small and Harbor ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avantis Small Cap and Harbor ETF Trust, you can compare the effects of market volatilities on Avantis Small and Harbor ETF 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 Avantis Small with a short position of Harbor ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avantis Small and Harbor ETF.
Diversification Opportunities for Avantis Small and Harbor ETF
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Avantis and Harbor is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Avantis Small Cap and Harbor ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor ETF Trust and Avantis Small 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 Avantis Small Cap are associated (or correlated) with Harbor ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor ETF Trust has no effect on the direction of Avantis Small i.e., Avantis Small and Harbor ETF go up and down completely randomly.
Pair Corralation between Avantis Small and Harbor ETF
Given the investment horizon of 90 days Avantis Small is expected to generate 1.55 times less return on investment than Harbor ETF. But when comparing it to its historical volatility, Avantis Small Cap is 1.1 times less risky than Harbor ETF. It trades about 0.06 of its potential returns per unit of risk. Harbor ETF Trust is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3,151 in Harbor ETF Trust on September 5, 2024 and sell it today you would earn a total of 413.00 from holding Harbor ETF Trust or generate 13.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 20.61% |
| Values | Daily Returns |
Avantis Small Cap vs. Harbor ETF Trust
Performance |
| Timeline |
| Avantis Small Cap |
| Harbor ETF Trust |
Avantis Small and Harbor ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avantis Small and Harbor ETF
The main advantage of trading using opposite Avantis Small and Harbor ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avantis Small position performs unexpectedly, Harbor ETF 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 Harbor ETF will offset losses from the drop in Harbor ETF's long position.| Avantis Small vs. Horizon Kinetics Inflation | Avantis Small vs. Virtus ETF Trust | Avantis Small vs. iShares MSCI USA | Avantis Small vs. Pacer Cash Cows |
| Harbor ETF vs. Horizon Kinetics Inflation | Harbor ETF vs. Virtus ETF Trust | Harbor ETF vs. iShares MSCI USA | Harbor ETF vs. Pacer Cash Cows |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |