Correlation Between Guardian Dividend and Federated Global
Can any of the company-specific risk be diversified away by investing in both Guardian Dividend and Federated Global 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 Guardian Dividend and Federated Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guardian Dividend Growth and Federated Global Allocation, you can compare the effects of market volatilities on Guardian Dividend and Federated Global 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 Guardian Dividend with a short position of Federated Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardian Dividend and Federated Global.
Diversification Opportunities for Guardian Dividend and Federated Global
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guardian and Federated is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Guardian Dividend Growth and Federated Global Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Global All and Guardian Dividend 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 Guardian Dividend Growth are associated (or correlated) with Federated Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Global All has no effect on the direction of Guardian Dividend i.e., Guardian Dividend and Federated Global go up and down completely randomly.
Pair Corralation between Guardian Dividend and Federated Global
Assuming the 90 days horizon Guardian Dividend is expected to generate 1.06 times less return on investment than Federated Global. In addition to that, Guardian Dividend is 1.11 times more volatile than Federated Global Allocation. It trades about 0.26 of its total potential returns per unit of risk. Federated Global Allocation is currently generating about 0.31 per unit of volatility. If you would invest 1,952 in Federated Global Allocation on September 3, 2024 and sell it today you would earn a total of 58.00 from holding Federated Global Allocation or generate 2.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guardian Dividend Growth vs. Federated Global Allocation
Performance |
| Timeline |
| Guardian Dividend Growth |
| Federated Global All |
Guardian Dividend and Federated Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guardian Dividend and Federated Global
The main advantage of trading using opposite Guardian Dividend and Federated Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardian Dividend position performs unexpectedly, Federated Global 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 Global will offset losses from the drop in Federated Global's long position.| Guardian Dividend vs. Ab Government Exchange | Guardian Dividend vs. Aig Government Money | Guardian Dividend vs. Dreyfus Government Cash | Guardian Dividend vs. Us Government Securities |
| Federated Global vs. Federated Max Cap Index | Federated Global vs. Federated Kaufmann Fund | Federated Global vs. Federated Strategic Income | Federated Global vs. Federated Bond Fund |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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