Correlation Between Cognios Market and Versus Capital
Can any of the company-specific risk be diversified away by investing in both Cognios Market and Versus Capital 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 Cognios Market and Versus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cognios Market Neutral and Versus Capital Multi Manager, you can compare the effects of market volatilities on Cognios Market and Versus Capital 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 Cognios Market with a short position of Versus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognios Market and Versus Capital.
Diversification Opportunities for Cognios Market and Versus Capital
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cognios and Versus is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Cognios Market Neutral and Versus Capital Multi Manager in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Versus Capital Multi and Cognios Market 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 Cognios Market Neutral are associated (or correlated) with Versus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Versus Capital Multi has no effect on the direction of Cognios Market i.e., Cognios Market and Versus Capital go up and down completely randomly.
Pair Corralation between Cognios Market and Versus Capital
Assuming the 90 days horizon Cognios Market Neutral is expected to under-perform the Versus Capital. In addition to that, Cognios Market is 1.37 times more volatile than Versus Capital Multi Manager. It trades about -0.04 of its total potential returns per unit of risk. Versus Capital Multi Manager is currently generating about 0.17 per unit of volatility. If you would invest 2,437 in Versus Capital Multi Manager on November 27, 2024 and sell it today you would earn a total of 13.00 from holding Versus Capital Multi Manager or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cognios Market Neutral vs. Versus Capital Multi Manager
Performance |
| Timeline |
| Cognios Market Neutral |
| Versus Capital Multi |
Cognios Market and Versus Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cognios Market and Versus Capital
The main advantage of trading using opposite Cognios Market and Versus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cognios Market position performs unexpectedly, Versus Capital 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 Versus Capital will offset losses from the drop in Versus Capital's long position.| Cognios Market vs. Virtus Convertible | Cognios Market vs. Calamos Vertible Fund | Cognios Market vs. Franklin Vertible Securities | Cognios Market vs. Putnam Vertible Securities |
| Versus Capital vs. Lord Abbett Intermediate | Versus Capital vs. Federated Government Income | Versus Capital vs. Us Government Securities | Versus Capital vs. T Rowe Price |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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