Correlation Between FlexShares Core and Anfield Universal
Can any of the company-specific risk be diversified away by investing in both FlexShares Core and Anfield Universal 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 FlexShares Core and Anfield Universal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FlexShares Core Select and Anfield Universal Fixed, you can compare the effects of market volatilities on FlexShares Core and Anfield Universal 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 FlexShares Core with a short position of Anfield Universal. Check out your portfolio center. Please also check ongoing floating volatility patterns of FlexShares Core and Anfield Universal.
Diversification Opportunities for FlexShares Core and Anfield Universal
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FlexShares and Anfield is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding FlexShares Core Select and Anfield Universal Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anfield Universal Fixed and FlexShares Core 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 FlexShares Core Select are associated (or correlated) with Anfield Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anfield Universal Fixed has no effect on the direction of FlexShares Core i.e., FlexShares Core and Anfield Universal go up and down completely randomly.
Pair Corralation between FlexShares Core and Anfield Universal
Given the investment horizon of 90 days FlexShares Core Select is expected to under-perform the Anfield Universal. In addition to that, FlexShares Core is 3.95 times more volatile than Anfield Universal Fixed. It trades about -0.07 of its total potential returns per unit of risk. Anfield Universal Fixed is currently generating about 0.4 per unit of volatility. If you would invest 910.00 in Anfield Universal Fixed on August 27, 2024 and sell it today you would earn a total of 6.00 from holding Anfield Universal Fixed or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FlexShares Core Select vs. Anfield Universal Fixed
Performance |
| Timeline |
| FlexShares Core Select |
| Anfield Universal Fixed |
FlexShares Core and Anfield Universal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FlexShares Core and Anfield Universal
The main advantage of trading using opposite FlexShares Core and Anfield Universal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FlexShares Core position performs unexpectedly, Anfield Universal 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 Anfield Universal will offset losses from the drop in Anfield Universal's long position.| FlexShares Core vs. iShares MSCI EAFE | FlexShares Core vs. iShares iBoxx Investment | FlexShares Core vs. iShares TIPS Bond | FlexShares Core vs. iShares 1 3 Year |
| Anfield Universal vs. FlexShares Core Select | Anfield Universal vs. Anfield Equity Sector | Anfield Universal vs. WisdomTree Interest Rate |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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