Correlation Between Crawford Multi-asset and Great-west Inflation-protec
Can any of the company-specific risk be diversified away by investing in both Crawford Multi-asset and Great-west Inflation-protec 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 Crawford Multi-asset and Great-west Inflation-protec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crawford Multi Asset Income and Great West Inflation Protected Securities, you can compare the effects of market volatilities on Crawford Multi-asset and Great-west Inflation-protec 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 Crawford Multi-asset with a short position of Great-west Inflation-protec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford Multi-asset and Great-west Inflation-protec.
Diversification Opportunities for Crawford Multi-asset and Great-west Inflation-protec
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Crawford and Great-west is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Multi Asset Income and Great West Inflation Protected in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great-west Inflation-protec and Crawford Multi-asset 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 Crawford Multi Asset Income are associated (or correlated) with Great-west Inflation-protec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great-west Inflation-protec has no effect on the direction of Crawford Multi-asset i.e., Crawford Multi-asset and Great-west Inflation-protec go up and down completely randomly.
Pair Corralation between Crawford Multi-asset and Great-west Inflation-protec
Assuming the 90 days horizon Crawford Multi Asset Income is expected to under-perform the Great-west Inflation-protec. But the mutual fund apears to be less risky and, when comparing its historical volatility, Crawford Multi Asset Income is 1.43 times less risky than Great-west Inflation-protec. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Great West Inflation Protected Securities is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 898.00 in Great West Inflation Protected Securities on November 3, 2024 and sell it today you would earn a total of 2.00 from holding Great West Inflation Protected Securities or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.56% |
| Values | Daily Returns |
Crawford Multi Asset Income vs. Great West Inflation Protected
Performance |
| Timeline |
| Crawford Multi Asset |
| Great-west Inflation-protec |
Crawford Multi-asset and Great-west Inflation-protec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crawford Multi-asset and Great-west Inflation-protec
The main advantage of trading using opposite Crawford Multi-asset and Great-west Inflation-protec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crawford Multi-asset position performs unexpectedly, Great-west Inflation-protec 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 Great-west Inflation-protec will offset losses from the drop in Great-west Inflation-protec's long position.The idea behind Crawford Multi Asset Income and Great West Inflation Protected Securities pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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