Correlation Between Causeway Emerging and Harding Loevner
Can any of the company-specific risk be diversified away by investing in both Causeway Emerging and Harding Loevner 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 Causeway Emerging and Harding Loevner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Causeway Emerging Markets and Harding Loevner Institutional, you can compare the effects of market volatilities on Causeway Emerging and Harding Loevner 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 Causeway Emerging with a short position of Harding Loevner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Causeway Emerging and Harding Loevner.
Diversification Opportunities for Causeway Emerging and Harding Loevner
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Causeway and Harding is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Causeway Emerging Markets and Harding Loevner Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harding Loevner Inst and Causeway 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 Causeway Emerging Markets are associated (or correlated) with Harding Loevner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harding Loevner Inst has no effect on the direction of Causeway Emerging i.e., Causeway Emerging and Harding Loevner go up and down completely randomly.
Pair Corralation between Causeway Emerging and Harding Loevner
Assuming the 90 days horizon Causeway Emerging Markets is expected to generate 1.03 times more return on investment than Harding Loevner. However, Causeway Emerging is 1.03 times more volatile than Harding Loevner Institutional. It trades about 0.07 of its potential returns per unit of risk. Harding Loevner Institutional is currently generating about 0.02 per unit of risk. If you would invest 917.00 in Causeway Emerging Markets on September 2, 2024 and sell it today you would earn a total of 211.00 from holding Causeway Emerging Markets or generate 23.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Causeway Emerging Markets vs. Harding Loevner Institutional
Performance |
| Timeline |
| Causeway Emerging Markets |
| Harding Loevner Inst |
Causeway Emerging and Harding Loevner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Causeway Emerging and Harding Loevner
The main advantage of trading using opposite Causeway Emerging and Harding Loevner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Causeway Emerging position performs unexpectedly, Harding Loevner 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 Harding Loevner will offset losses from the drop in Harding Loevner's long position.| Causeway Emerging vs. Eagle Mlp Strategy | Causeway Emerging vs. Ashmore Emerging Markets | Causeway Emerging vs. Growth Strategy Fund | Causeway Emerging vs. Rbc Emerging Markets |
| Harding Loevner vs. Harding Loevner Funds | Harding Loevner vs. Harding Loevner Emerging | Harding Loevner vs. Harding Loevner Global | Harding Loevner vs. Harding Loevner Frontier |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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