Correlation Between Dgi Investment and Federated Government
Can any of the company-specific risk be diversified away by investing in both Dgi Investment and Federated Government 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 Dgi Investment and Federated Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dgi Investment Trust and Federated Government Ultrashort, you can compare the effects of market volatilities on Dgi Investment and Federated Government 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 Dgi Investment with a short position of Federated Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dgi Investment and Federated Government.
Diversification Opportunities for Dgi Investment and Federated Government
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between DGI and FEDERATED is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Dgi Investment Trust and Federated Government Ultrashor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Government and Dgi Investment 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 Dgi Investment Trust are associated (or correlated) with Federated Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Government has no effect on the direction of Dgi Investment i.e., Dgi Investment and Federated Government go up and down completely randomly.
Pair Corralation between Dgi Investment and Federated Government
Assuming the 90 days horizon Dgi Investment Trust is expected to generate 4.53 times more return on investment than Federated Government. However, Dgi Investment is 4.53 times more volatile than Federated Government Ultrashort. It trades about 0.12 of its potential returns per unit of risk. Federated Government Ultrashort is currently generating about 0.25 per unit of risk. If you would invest 967.00 in Dgi Investment Trust on October 25, 2024 and sell it today you would earn a total of 211.00 from holding Dgi Investment Trust or generate 21.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dgi Investment Trust vs. Federated Government Ultrashor
Performance |
| Timeline |
| Dgi Investment Trust |
| Federated Government |
Dgi Investment and Federated Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dgi Investment and Federated Government
The main advantage of trading using opposite Dgi Investment and Federated Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dgi Investment position performs unexpectedly, Federated Government 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 Government will offset losses from the drop in Federated Government's long position.| Dgi Investment vs. Federated Government Ultrashort | Dgi Investment vs. Touchstone Ultra Short | Dgi Investment vs. Nuveen Short Duration High | Dgi Investment vs. Angel Oak Ultrashort |
| Federated Government vs. Pimco Short Term Fund | Federated Government vs. Short Term Fund Institutional | Federated Government vs. Short Term Fund Administrative | Federated Government vs. Short Term Fund R |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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