Correlation Between Invesco BulletShares and MYMF
Can any of the company-specific risk be diversified away by investing in both Invesco BulletShares and MYMF 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 Invesco BulletShares and MYMF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco BulletShares 2028 and MYMF, you can compare the effects of market volatilities on Invesco BulletShares and MYMF 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 Invesco BulletShares with a short position of MYMF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco BulletShares and MYMF.
Diversification Opportunities for Invesco BulletShares and MYMF
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Invesco and MYMF is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Invesco BulletShares 2028 and MYMF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYMF and Invesco BulletShares 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 Invesco BulletShares 2028 are associated (or correlated) with MYMF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYMF has no effect on the direction of Invesco BulletShares i.e., Invesco BulletShares and MYMF go up and down completely randomly.
Pair Corralation between Invesco BulletShares and MYMF
Given the investment horizon of 90 days Invesco BulletShares 2028 is expected to generate 1.78 times more return on investment than MYMF. However, Invesco BulletShares is 1.78 times more volatile than MYMF. It trades about 0.11 of its potential returns per unit of risk. MYMF is currently generating about 0.1 per unit of risk. If you would invest 2,291 in Invesco BulletShares 2028 on September 3, 2024 and sell it today you would earn a total of 66.00 from holding Invesco BulletShares 2028 or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 39.2% |
| Values | Daily Returns |
Invesco BulletShares 2028 vs. MYMF
Performance |
| Timeline |
| Invesco BulletShares 2028 |
| MYMF |
Invesco BulletShares and MYMF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco BulletShares and MYMF
The main advantage of trading using opposite Invesco BulletShares and MYMF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco BulletShares position performs unexpectedly, MYMF 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 MYMF will offset losses from the drop in MYMF's long position.| Invesco BulletShares vs. Invesco BulletShares 2024 | Invesco BulletShares vs. Invesco BulletShares 2026 | Invesco BulletShares vs. Invesco BulletShares 2027 |
| MYMF vs. VanEck Vectors Moodys | MYMF vs. Xtrackers California Municipal | MYMF vs. Vanguard ESG Corporate | MYMF vs. Vanguard Intermediate Term Corporate |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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