Correlation Between Blue Current and Power Global
Can any of the company-specific risk be diversified away by investing in both Blue Current and Power Global 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 Blue Current and Power Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Current Global and Power Global Tactical, you can compare the effects of market volatilities on Blue Current and Power Global 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 Blue Current with a short position of Power Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Current and Power Global.
Diversification Opportunities for Blue Current and Power Global
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Blue and Power is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Blue Current Global and Power Global Tactical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Global Tactical and Blue Current 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 Blue Current Global are associated (or correlated) with Power Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Global Tactical has no effect on the direction of Blue Current i.e., Blue Current and Power Global go up and down completely randomly.
Pair Corralation between Blue Current and Power Global
Assuming the 90 days horizon Blue Current Global is expected to generate 1.62 times more return on investment than Power Global. However, Blue Current is 1.62 times more volatile than Power Global Tactical. It trades about 0.07 of its potential returns per unit of risk. Power Global Tactical is currently generating about 0.05 per unit of risk. If you would invest 1,630 in Blue Current Global on November 27, 2024 and sell it today you would earn a total of 15.00 from holding Blue Current Global or generate 0.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Current Global vs. Power Global Tactical
Performance |
| Timeline |
| Blue Current Global |
| Power Global Tactical |
Blue Current and Power Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Current and Power Global
The main advantage of trading using opposite Blue Current and Power Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Current position performs unexpectedly, Power Global 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 Power Global will offset losses from the drop in Power Global's long position.| Blue Current vs. Tekla Healthcare Investors | Blue Current vs. Eaton Vance Worldwide | Blue Current vs. T Rowe Price | Blue Current vs. Blackrock Health Sciences |
| Power Global vs. John Hancock Government | Power Global vs. Bbh Intermediate Municipal | Power Global vs. Ab Municipal Bond | Power Global vs. Us Government Securities |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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