Correlation Between FT Vest and Listed Funds
Can any of the company-specific risk be diversified away by investing in both FT Vest and Listed Funds 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 Listed Funds 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 Listed Funds Trust, you can compare the effects of market volatilities on FT Vest and Listed Funds 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 Listed Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Vest and Listed Funds.
Diversification Opportunities for FT Vest and Listed Funds
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DHDG and Listed is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding FT Vest Equity and Listed Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Listed Funds Trust 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 Listed Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Listed Funds Trust has no effect on the direction of FT Vest i.e., FT Vest and Listed Funds go up and down completely randomly.
Pair Corralation between FT Vest and Listed Funds
Given the investment horizon of 90 days FT Vest is expected to generate 1.37 times less return on investment than Listed Funds. But when comparing it to its historical volatility, FT Vest Equity is 1.53 times less risky than Listed Funds. It trades about 0.41 of its potential returns per unit of risk. Listed Funds Trust is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 3,495 in Listed Funds Trust on September 4, 2024 and sell it today you would earn a total of 160.00 from holding Listed Funds Trust or generate 4.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FT Vest Equity vs. Listed Funds Trust
Performance |
| Timeline |
| FT Vest Equity |
| Listed Funds Trust |
FT Vest and Listed Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FT Vest and Listed Funds
The main advantage of trading using opposite FT Vest and Listed Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FT Vest position performs unexpectedly, Listed Funds 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 Listed Funds will offset losses from the drop in Listed Funds' long position.| FT Vest vs. Vanguard Total Stock | FT Vest vs. SPDR SP 500 | FT Vest vs. Vanguard Total Bond | FT Vest vs. Vanguard Value Index |
| Listed Funds vs. FT Vest Equity | Listed Funds vs. Northern Lights | Listed Funds vs. Dimensional International High | Listed Funds vs. JPMorgan Fundamental Data |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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