Correlation Between Capital Group and Martin Currie
Can any of the company-specific risk be diversified away by investing in both Capital Group and Martin Currie 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 Capital Group and Martin Currie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Group International and Martin Currie Sustainable, you can compare the effects of market volatilities on Capital Group and Martin Currie 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 Capital Group with a short position of Martin Currie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Group and Martin Currie.
Diversification Opportunities for Capital Group and Martin Currie
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Capital and Martin is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Capital Group International and Martin Currie Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Martin Currie Sustainable and Capital Group 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 Capital Group International are associated (or correlated) with Martin Currie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Martin Currie Sustainable has no effect on the direction of Capital Group i.e., Capital Group and Martin Currie go up and down completely randomly.
Pair Corralation between Capital Group and Martin Currie
Given the investment horizon of 90 days Capital Group International is expected to generate 0.81 times more return on investment than Martin Currie. However, Capital Group International is 1.23 times less risky than Martin Currie. It trades about 0.05 of its potential returns per unit of risk. Martin Currie Sustainable is currently generating about 0.01 per unit of risk. If you would invest 2,116 in Capital Group International on August 30, 2024 and sell it today you would earn a total of 462.00 from holding Capital Group International or generate 21.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Group International vs. Martin Currie Sustainable
Performance |
| Timeline |
| Capital Group Intern |
| Martin Currie Sustainable |
Capital Group and Martin Currie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Group and Martin Currie
The main advantage of trading using opposite Capital Group and Martin Currie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Group position performs unexpectedly, Martin Currie 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 Martin Currie will offset losses from the drop in Martin Currie's long position.| Capital Group vs. Stance Equity ESG | Capital Group vs. Aquagold International | Capital Group vs. Morningstar Unconstrained Allocation | Capital Group vs. Thrivent High Yield |
| Martin Currie vs. BrandywineGLOBAL Dynamic | Martin Currie vs. First Trust Growth | Martin Currie vs. Invesco NASDAQ Future | Martin Currie vs. Burney Factor Rotation |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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