Correlation Between Boston Partners and Lifex Inflation-protec
Can any of the company-specific risk be diversified away by investing in both Boston Partners and Lifex Inflation-protec 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 Boston Partners and Lifex Inflation-protec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Partners Small and Lifex Inflation Protected Income, you can compare the effects of market volatilities on Boston Partners and Lifex Inflation-protec 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 Boston Partners with a short position of Lifex Inflation-protec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Partners and Lifex Inflation-protec.
Diversification Opportunities for Boston Partners and Lifex Inflation-protec
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Boston and Lifex is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Boston Partners Small and Lifex Inflation Protected Inco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifex Inflation-protec and Boston Partners 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 Boston Partners Small are associated (or correlated) with Lifex Inflation-protec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifex Inflation-protec has no effect on the direction of Boston Partners i.e., Boston Partners and Lifex Inflation-protec go up and down completely randomly.
Pair Corralation between Boston Partners and Lifex Inflation-protec
Assuming the 90 days horizon Boston Partners Small is expected to generate 3.71 times more return on investment than Lifex Inflation-protec. However, Boston Partners is 3.71 times more volatile than Lifex Inflation Protected Income. It trades about 0.1 of its potential returns per unit of risk. Lifex Inflation Protected Income is currently generating about 0.1 per unit of risk. If you would invest 2,536 in Boston Partners Small on September 1, 2024 and sell it today you would earn a total of 422.00 from holding Boston Partners Small or generate 16.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Boston Partners Small vs. Lifex Inflation Protected Inco
Performance |
| Timeline |
| Boston Partners Small |
| Lifex Inflation-protec |
Boston Partners and Lifex Inflation-protec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Partners and Lifex Inflation-protec
The main advantage of trading using opposite Boston Partners and Lifex Inflation-protec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Partners position performs unexpectedly, Lifex Inflation-protec 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 Lifex Inflation-protec will offset losses from the drop in Lifex Inflation-protec's long position.| Boston Partners vs. Aggressive Investors 1 | Boston Partners vs. Buffalo Small Cap | Boston Partners vs. Rice Hall James | Boston Partners vs. Putnam Small Cap |
| Lifex Inflation-protec vs. Sprott Gold Equity | Lifex Inflation-protec vs. Global Gold Fund | Lifex Inflation-protec vs. Invesco Gold Special | Lifex Inflation-protec vs. Gamco Global Gold |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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