Correlation Between Boston Partners and Cref Inflation
Can any of the company-specific risk be diversified away by investing in both Boston Partners and Cref Inflation 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 Cref Inflation 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 Cref Inflation Linked Bond, you can compare the effects of market volatilities on Boston Partners and Cref Inflation 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 Cref Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Partners and Cref Inflation.
Diversification Opportunities for Boston Partners and Cref Inflation
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boston and Cref is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Boston Partners Small and Cref Inflation Linked Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Inflation Linked 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 Cref Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Inflation Linked has no effect on the direction of Boston Partners i.e., Boston Partners and Cref Inflation go up and down completely randomly.
Pair Corralation between Boston Partners and Cref Inflation
Assuming the 90 days horizon Boston Partners Small is expected to generate 5.86 times more return on investment than Cref Inflation. However, Boston Partners is 5.86 times more volatile than Cref Inflation Linked Bond. It trades about 0.06 of its potential returns per unit of risk. Cref Inflation Linked Bond is currently generating about 0.29 per unit of risk. If you would invest 2,892 in Boston Partners Small on September 13, 2024 and sell it today you would earn a total of 26.00 from holding Boston Partners Small or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Boston Partners Small vs. Cref Inflation Linked Bond
Performance |
| Timeline |
| Boston Partners Small |
| Cref Inflation Linked |
Boston Partners and Cref Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Partners and Cref Inflation
The main advantage of trading using opposite Boston Partners and Cref Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Partners position performs unexpectedly, Cref Inflation 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 Cref Inflation will offset losses from the drop in Cref Inflation's long position.| Boston Partners vs. Aggressive Investors 1 | Boston Partners vs. Buffalo Small Cap | Boston Partners vs. Putnam Small Cap | Boston Partners vs. Dreyfus Strategic Value |
| Cref Inflation vs. Vanguard Total Stock | Cref Inflation vs. Vanguard 500 Index | Cref Inflation vs. Vanguard Total Stock | Cref Inflation vs. Vanguard Total Stock |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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