Correlation Between Manning Napier and Pro-blend(r) Maximum
Can any of the company-specific risk be diversified away by investing in both Manning Napier and Pro-blend(r) Maximum 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 Manning Napier and Pro-blend(r) Maximum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manning Napier Callodine and Pro Blend Maximum Term, you can compare the effects of market volatilities on Manning Napier and Pro-blend(r) Maximum 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 Manning Napier with a short position of Pro-blend(r) Maximum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manning Napier and Pro-blend(r) Maximum.
Diversification Opportunities for Manning Napier and Pro-blend(r) Maximum
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Manning and Pro-blend(r) is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Manning Napier Callodine and Pro Blend Maximum Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pro-blend(r) Maximum and Manning Napier 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 Manning Napier Callodine are associated (or correlated) with Pro-blend(r) Maximum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pro-blend(r) Maximum has no effect on the direction of Manning Napier i.e., Manning Napier and Pro-blend(r) Maximum go up and down completely randomly.
Pair Corralation between Manning Napier and Pro-blend(r) Maximum
Assuming the 90 days horizon Manning Napier Callodine is expected to generate 1.7 times more return on investment than Pro-blend(r) Maximum. However, Manning Napier is 1.7 times more volatile than Pro Blend Maximum Term. It trades about 0.3 of its potential returns per unit of risk. Pro Blend Maximum Term is currently generating about 0.12 per unit of risk. If you would invest 1,449 in Manning Napier Callodine on August 26, 2024 and sell it today you would earn a total of 109.00 from holding Manning Napier Callodine or generate 7.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manning Napier Callodine vs. Pro Blend Maximum Term
Performance |
| Timeline |
| Manning Napier Callodine |
| Pro-blend(r) Maximum |
Manning Napier and Pro-blend(r) Maximum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manning Napier and Pro-blend(r) Maximum
The main advantage of trading using opposite Manning Napier and Pro-blend(r) Maximum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manning Napier position performs unexpectedly, Pro-blend(r) Maximum 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 Pro-blend(r) Maximum will offset losses from the drop in Pro-blend(r) Maximum's long position.| Manning Napier vs. Manning Napier Callodine | Manning Napier vs. Pro Blend Extended Term | Manning Napier vs. Pro Blend Extended Term | Manning Napier vs. Unconstrained Bond Series |
| Pro-blend(r) Maximum vs. Manning Napier Callodine | Pro-blend(r) Maximum vs. Manning Napier Callodine | Pro-blend(r) Maximum vs. Manning Napier Callodine | Pro-blend(r) Maximum vs. Pro Blend Extended Term |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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