Correlation Between Cullen Emerging and Cullen International
Can any of the company-specific risk be diversified away by investing in both Cullen Emerging and Cullen International 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 Cullen International 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 Cullen International High, you can compare the effects of market volatilities on Cullen Emerging and Cullen International 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 Cullen International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cullen Emerging and Cullen International.
Diversification Opportunities for Cullen Emerging and Cullen International
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cullen and Cullen is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cullen Emerging Markets and Cullen International High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen International High 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 Cullen International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen International High has no effect on the direction of Cullen Emerging i.e., Cullen Emerging and Cullen International go up and down completely randomly.
Pair Corralation between Cullen Emerging and Cullen International
Assuming the 90 days horizon Cullen Emerging Markets is expected to generate 0.84 times more return on investment than Cullen International. However, Cullen Emerging Markets is 1.2 times less risky than Cullen International. It trades about -0.15 of its potential returns per unit of risk. Cullen International High is currently generating about -0.13 per unit of risk. If you would invest 1,257 in Cullen Emerging Markets on August 26, 2024 and sell it today you would lose (24.00) from holding Cullen Emerging Markets or give up 1.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cullen Emerging Markets vs. Cullen International High
Performance |
| Timeline |
| Cullen Emerging Markets |
| Cullen International High |
Cullen Emerging and Cullen International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cullen Emerging and Cullen International
The main advantage of trading using opposite Cullen Emerging and Cullen International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cullen Emerging position performs unexpectedly, Cullen International 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 Cullen International will offset losses from the drop in Cullen International's long position.| Cullen Emerging vs. Cullen Small Cap | Cullen Emerging vs. Cullen Small Cap | Cullen Emerging vs. Cullen Small Cap | Cullen Emerging vs. Cullen Value Fund |
| Cullen International vs. Black Oak Emerging | Cullen International vs. Investec Emerging Markets | Cullen International vs. Rbc Bluebay Emerging | Cullen International vs. Pnc Emerging Markets |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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