Correlation Between FT Vest and Aptus Large
Can any of the company-specific risk be diversified away by investing in both FT Vest and Aptus Large 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 FT Vest and Aptus Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FT Vest Equity and Aptus Large Cap, you can compare the effects of market volatilities on FT Vest and Aptus Large 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 FT Vest with a short position of Aptus Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Vest and Aptus Large.
Diversification Opportunities for FT Vest and Aptus Large
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DHDG and Aptus is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding FT Vest Equity and Aptus Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Large Cap and FT Vest 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 FT Vest Equity are associated (or correlated) with Aptus Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Large Cap has no effect on the direction of FT Vest i.e., FT Vest and Aptus Large go up and down completely randomly.
Pair Corralation between FT Vest and Aptus Large
Given the investment horizon of 90 days FT Vest is expected to generate 1.47 times less return on investment than Aptus Large. But when comparing it to its historical volatility, FT Vest Equity is 1.95 times less risky than Aptus Large. It trades about 0.18 of its potential returns per unit of risk. Aptus Large Cap is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,915 in Aptus Large Cap on September 1, 2024 and sell it today you would earn a total of 416.00 from holding Aptus Large Cap or generate 14.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 22.83% |
| Values | Daily Returns |
FT Vest Equity vs. Aptus Large Cap
Performance |
| Timeline |
| FT Vest Equity |
| Aptus Large Cap |
FT Vest and Aptus Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FT Vest and Aptus Large
The main advantage of trading using opposite FT Vest and Aptus Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FT Vest position performs unexpectedly, Aptus Large 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 Aptus Large will offset losses from the drop in Aptus Large's long position.| FT Vest vs. Vanguard Total Stock | FT Vest vs. SPDR SP 500 | FT Vest vs. iShares Core SP | FT Vest vs. Vanguard Total Bond |
| Aptus Large vs. Vanguard Total Stock | Aptus Large vs. SPDR SP 500 | Aptus Large vs. iShares Core SP | Aptus Large vs. Vanguard Dividend Appreciation |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |