Correlation Between SmartETFs Dividend and REX FANG
Can any of the company-specific risk be diversified away by investing in both SmartETFs Dividend and REX FANG 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 SmartETFs Dividend and REX FANG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SmartETFs Dividend Builder and REX FANG Innovation, you can compare the effects of market volatilities on SmartETFs Dividend and REX FANG 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 SmartETFs Dividend with a short position of REX FANG. Check out your portfolio center. Please also check ongoing floating volatility patterns of SmartETFs Dividend and REX FANG.
Diversification Opportunities for SmartETFs Dividend and REX FANG
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SmartETFs and REX is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding SmartETFs Dividend Builder and REX FANG Innovation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REX FANG Innovation and SmartETFs 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 SmartETFs Dividend Builder are associated (or correlated) with REX FANG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REX FANG Innovation has no effect on the direction of SmartETFs Dividend i.e., SmartETFs Dividend and REX FANG go up and down completely randomly.
Pair Corralation between SmartETFs Dividend and REX FANG
Given the investment horizon of 90 days SmartETFs Dividend is expected to generate 2.73 times less return on investment than REX FANG. But when comparing it to its historical volatility, SmartETFs Dividend Builder is 1.6 times less risky than REX FANG. It trades about 0.13 of its potential returns per unit of risk. REX FANG Innovation is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 4,921 in REX FANG Innovation on September 1, 2024 and sell it today you would earn a total of 199.00 from holding REX FANG Innovation or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SmartETFs Dividend Builder vs. REX FANG Innovation
Performance |
| Timeline |
| SmartETFs Dividend |
| REX FANG Innovation |
SmartETFs Dividend and REX FANG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SmartETFs Dividend and REX FANG
The main advantage of trading using opposite SmartETFs Dividend and REX FANG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SmartETFs Dividend position performs unexpectedly, REX FANG 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 REX FANG will offset losses from the drop in REX FANG's long position.| SmartETFs Dividend vs. SmartETFs Asia Pacific | SmartETFs Dividend vs. Listed Funds Trust | SmartETFs Dividend vs. iShares AsiaPacific Dividend | SmartETFs Dividend vs. ProShares MSCI Emerging |
| REX FANG vs. Freedom Day Dividend | REX FANG vs. iShares MSCI China | REX FANG vs. iShares Dividend and | REX FANG vs. SmartETFs Dividend Builder |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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