Correlation Between Dana Large and Aim Investment
Can any of the company-specific risk be diversified away by investing in both Dana Large and Aim Investment 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 Dana Large and Aim Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Large Cap and Aim Investment Secs, you can compare the effects of market volatilities on Dana Large and Aim Investment 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 Dana Large with a short position of Aim Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana Large and Aim Investment.
Diversification Opportunities for Dana Large and Aim Investment
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dana and Aim is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dana Large Cap and Aim Investment Secs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aim Investment Secs and Dana Large 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 Dana Large Cap are associated (or correlated) with Aim Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aim Investment Secs has no effect on the direction of Dana Large i.e., Dana Large and Aim Investment go up and down completely randomly.
Pair Corralation between Dana Large and Aim Investment
If you would invest 2,563 in Dana Large Cap on September 3, 2024 and sell it today you would earn a total of 147.00 from holding Dana Large Cap or generate 5.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Large Cap vs. Aim Investment Secs
Performance |
| Timeline |
| Dana Large Cap |
| Aim Investment Secs |
Dana Large and Aim Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana Large and Aim Investment
The main advantage of trading using opposite Dana Large and Aim Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana Large position performs unexpectedly, Aim Investment 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 Aim Investment will offset losses from the drop in Aim Investment's long position.| Dana Large vs. Msift High Yield | Dana Large vs. Gmo High Yield | Dana Large vs. Guggenheim High Yield | Dana Large vs. Pgim High Yield |
| Aim Investment vs. Ab Value Fund | Aim Investment vs. Rbb Fund | Aim Investment vs. Abr 7525 Volatility | Aim Investment vs. Iaadx |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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