Correlation Between Credit Suisse and Federated Short-intermedia
Can any of the company-specific risk be diversified away by investing in both Credit Suisse and Federated Short-intermedia 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 Credit Suisse and Federated Short-intermedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Suisse Floating and Federated Short Intermediate Duration, you can compare the effects of market volatilities on Credit Suisse and Federated Short-intermedia 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 Credit Suisse with a short position of Federated Short-intermedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and Federated Short-intermedia.
Diversification Opportunities for Credit Suisse and Federated Short-intermedia
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Credit and Federated is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse Floating and Federated Short Intermediate D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short-intermedia and Credit Suisse 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 Credit Suisse Floating are associated (or correlated) with Federated Short-intermedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short-intermedia has no effect on the direction of Credit Suisse i.e., Credit Suisse and Federated Short-intermedia go up and down completely randomly.
Pair Corralation between Credit Suisse and Federated Short-intermedia
Assuming the 90 days horizon Credit Suisse is expected to generate 1.0 times less return on investment than Federated Short-intermedia. In addition to that, Credit Suisse is 1.51 times more volatile than Federated Short Intermediate Duration. It trades about 0.1 of its total potential returns per unit of risk. Federated Short Intermediate Duration is currently generating about 0.16 per unit of volatility. If you would invest 998.00 in Federated Short Intermediate Duration on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Federated Short Intermediate Duration or generate 0.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Credit Suisse Floating vs. Federated Short Intermediate D
Performance |
| Timeline |
| Credit Suisse Floating |
| Federated Short-intermedia |
Credit Suisse and Federated Short-intermedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Suisse and Federated Short-intermedia
The main advantage of trading using opposite Credit Suisse and Federated Short-intermedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Suisse position performs unexpectedly, Federated Short-intermedia 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 Federated Short-intermedia will offset losses from the drop in Federated Short-intermedia's long position.| Credit Suisse vs. Credit Suisse Floating | Credit Suisse vs. Credit Suisse Modity | Credit Suisse vs. Credit Suisse Modity | Credit Suisse vs. Credit Suisse Modity |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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