Correlation Between Multi Manager and Columbia Emerging
Can any of the company-specific risk be diversified away by investing in both Multi Manager and Columbia Emerging 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 Multi Manager and Columbia Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Manager Directional Alternative and Columbia Emerging Markets, you can compare the effects of market volatilities on Multi Manager and Columbia Emerging 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 Multi Manager with a short position of Columbia Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Manager and Columbia Emerging.
Diversification Opportunities for Multi Manager and Columbia Emerging
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Multi and Columbia is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Multi Manager Directional Alte and Columbia Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Emerging Markets and Multi Manager 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 Multi Manager Directional Alternative are associated (or correlated) with Columbia Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Emerging Markets has no effect on the direction of Multi Manager i.e., Multi Manager and Columbia Emerging go up and down completely randomly.
Pair Corralation between Multi Manager and Columbia Emerging
Assuming the 90 days horizon Multi Manager is expected to generate 1.38 times less return on investment than Columbia Emerging. In addition to that, Multi Manager is 1.64 times more volatile than Columbia Emerging Markets. It trades about 0.09 of its total potential returns per unit of risk. Columbia Emerging Markets is currently generating about 0.2 per unit of volatility. If you would invest 1,335 in Columbia Emerging Markets on September 15, 2024 and sell it today you would earn a total of 11.00 from holding Columbia Emerging Markets or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 42.86% |
| Values | Daily Returns |
Multi Manager Directional Alte vs. Columbia Emerging Markets
Performance |
| Timeline |
| Multi Manager Direct |
| Columbia Emerging Markets |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
Multi Manager and Columbia Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Manager and Columbia Emerging
The main advantage of trading using opposite Multi Manager and Columbia Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Manager position performs unexpectedly, Columbia Emerging 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 Columbia Emerging will offset losses from the drop in Columbia Emerging's long position.| Multi Manager vs. Putnam Money Market | Multi Manager vs. Ab Government Exchange | Multi Manager vs. Blackrock Exchange Portfolio | Multi Manager vs. Ubs Money Series |
| Columbia Emerging vs. Columbia Porate Income | Columbia Emerging vs. Columbia Ultra Short | Columbia Emerging vs. Columbia Treasury Index | Columbia Emerging vs. Multi Manager Directional Alternative |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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