Correlation Between Cullen Emerging and Health Biotchnology
Can any of the company-specific risk be diversified away by investing in both Cullen Emerging and Health Biotchnology 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 Cullen Emerging and Health Biotchnology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cullen Emerging Markets and Health Biotchnology Portfolio, you can compare the effects of market volatilities on Cullen Emerging and Health Biotchnology 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 Cullen Emerging with a short position of Health Biotchnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cullen Emerging and Health Biotchnology.
Diversification Opportunities for Cullen Emerging and Health Biotchnology
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cullen and Health is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Cullen Emerging Markets and Health Biotchnology Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Health Biotchnology and Cullen Emerging 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 Cullen Emerging Markets are associated (or correlated) with Health Biotchnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Health Biotchnology has no effect on the direction of Cullen Emerging i.e., Cullen Emerging and Health Biotchnology go up and down completely randomly.
Pair Corralation between Cullen Emerging and Health Biotchnology
Assuming the 90 days horizon Cullen Emerging Markets is expected to generate 1.1 times more return on investment than Health Biotchnology. However, Cullen Emerging is 1.1 times more volatile than Health Biotchnology Portfolio. It trades about 0.02 of its potential returns per unit of risk. Health Biotchnology Portfolio is currently generating about -0.01 per unit of risk. If you would invest 1,268 in Cullen Emerging Markets on September 12, 2024 and sell it today you would earn a total of 27.00 from holding Cullen Emerging Markets or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Cullen Emerging Markets vs. Health Biotchnology Portfolio
Performance |
| Timeline |
| Cullen Emerging Markets |
| Health Biotchnology |
Cullen Emerging and Health Biotchnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cullen Emerging and Health Biotchnology
The main advantage of trading using opposite Cullen Emerging and Health Biotchnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cullen Emerging position performs unexpectedly, Health Biotchnology 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 Health Biotchnology will offset losses from the drop in Health Biotchnology's long position.| Cullen Emerging vs. Small Pany Growth | Cullen Emerging vs. Vy Columbia Small | Cullen Emerging vs. Champlain Small | Cullen Emerging vs. Pace Smallmedium Value |
| Health Biotchnology vs. Blackrock High Yield | Health Biotchnology vs. Artisan High Income | Health Biotchnology vs. Buffalo High Yield | Health Biotchnology vs. Prudential High Yield |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |