Correlation Between Columbia Global and Columbia Emerging
Can any of the company-specific risk be diversified away by investing in both Columbia Global and Columbia Emerging 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 Columbia Global and Columbia Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Global Equity and Columbia Emerging Markets, you can compare the effects of market volatilities on Columbia Global and Columbia Emerging 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 Columbia Global with a short position of Columbia Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Global and Columbia Emerging.
Diversification Opportunities for Columbia Global and Columbia Emerging
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Columbia and Columbia is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Global Equity and Columbia Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Emerging Markets and Columbia Global 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 Columbia Global Equity are associated (or correlated) with Columbia Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Emerging Markets has no effect on the direction of Columbia Global i.e., Columbia Global and Columbia Emerging go up and down completely randomly.
Pair Corralation between Columbia Global and Columbia Emerging
Assuming the 90 days horizon Columbia Global Equity is expected to generate 2.46 times more return on investment than Columbia Emerging. However, Columbia Global is 2.46 times more volatile than Columbia Emerging Markets. It trades about 0.26 of its potential returns per unit of risk. Columbia Emerging Markets is currently generating about 0.37 per unit of risk. If you would invest 1,230 in Columbia Global Equity on November 9, 2024 and sell it today you would earn a total of 48.00 from holding Columbia Global Equity or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Global Equity vs. Columbia Emerging Markets
Performance |
| Timeline |
| Columbia Global Equity |
| Columbia Emerging Markets |
Columbia Global and Columbia Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Global and Columbia Emerging
The main advantage of trading using opposite Columbia Global and Columbia Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Global position performs unexpectedly, Columbia Emerging 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 Emerging will offset losses from the drop in Columbia Emerging's long position.| Columbia Global vs. Amg River Road | Columbia Global vs. Valic Company I | Columbia Global vs. Small Cap Growth Profund | Columbia Global vs. Ab Discovery Value |
| Columbia Emerging vs. Eagle Mlp Strategy | Columbia Emerging vs. Growth Strategy Fund | Columbia Emerging vs. Nasdaq 100 2x Strategy | Columbia Emerging vs. Ab Tax Managed Wealth |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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