Correlation Between Multi Manager and Columbia Treasury
Can any of the company-specific risk be diversified away by investing in both Multi Manager and Columbia Treasury 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 Treasury 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 Treasury Index, you can compare the effects of market volatilities on Multi Manager and Columbia Treasury 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 Treasury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Manager and Columbia Treasury.
Diversification Opportunities for Multi Manager and Columbia Treasury
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Multi and Columbia is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Multi Manager Directional Alte and Columbia Treasury Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Treasury Index 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 Treasury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Treasury Index has no effect on the direction of Multi Manager i.e., Multi Manager and Columbia Treasury go up and down completely randomly.
Pair Corralation between Multi Manager and Columbia Treasury
Assuming the 90 days horizon Multi Manager Directional Alternative is expected to generate 1.31 times more return on investment than Columbia Treasury. However, Multi Manager is 1.31 times more volatile than Columbia Treasury Index. It trades about 0.17 of its potential returns per unit of risk. Columbia Treasury Index is currently generating about 0.05 per unit of risk. If you would invest 649.00 in Multi Manager Directional Alternative on August 30, 2024 and sell it today you would earn a total of 179.00 from holding Multi Manager Directional Alternative or generate 27.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Manager Directional Alte vs. Columbia Treasury Index
Performance |
| Timeline |
| Multi Manager Direct |
| Columbia Treasury Index |
Multi Manager and Columbia Treasury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Manager and Columbia Treasury
The main advantage of trading using opposite Multi Manager and Columbia Treasury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Manager position performs unexpectedly, Columbia Treasury 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 Treasury will offset losses from the drop in Columbia Treasury's long position.The idea behind Multi Manager Directional Alternative and Columbia Treasury Index pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Columbia Treasury vs. Europac Gold Fund | Columbia Treasury vs. Oppenheimer Gold Special | Columbia Treasury vs. Gold Portfolio Fidelity | Columbia Treasury vs. Goldman Sachs Centrated |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |