Correlation Between Parametric Commodity and Guggenheim High
Can any of the company-specific risk be diversified away by investing in both Parametric Commodity and Guggenheim High 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 Parametric Commodity and Guggenheim High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Parametric Modity Strategy and Guggenheim High Yield, you can compare the effects of market volatilities on Parametric Commodity and Guggenheim High 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 Parametric Commodity with a short position of Guggenheim High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Parametric Commodity and Guggenheim High.
Diversification Opportunities for Parametric Commodity and Guggenheim High
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Parametric and GUGGENHEIM is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Parametric Modity Strategy and Guggenheim High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim High Yield and Parametric Commodity 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 Parametric Modity Strategy are associated (or correlated) with Guggenheim High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim High Yield has no effect on the direction of Parametric Commodity i.e., Parametric Commodity and Guggenheim High go up and down completely randomly.
Pair Corralation between Parametric Commodity and Guggenheim High
Assuming the 90 days horizon Parametric Modity Strategy is expected to generate 5.35 times more return on investment than Guggenheim High. However, Parametric Commodity is 5.35 times more volatile than Guggenheim High Yield. It trades about 0.07 of its potential returns per unit of risk. Guggenheim High Yield is currently generating about 0.2 per unit of risk. If you would invest 641.00 in Parametric Modity Strategy on August 28, 2024 and sell it today you would earn a total of 7.00 from holding Parametric Modity Strategy or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Parametric Modity Strategy vs. Guggenheim High Yield
Performance |
| Timeline |
| Parametric Commodity |
| Guggenheim High Yield |
Parametric Commodity and Guggenheim High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Parametric Commodity and Guggenheim High
The main advantage of trading using opposite Parametric Commodity and Guggenheim High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Parametric Commodity position performs unexpectedly, Guggenheim High 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 Guggenheim High will offset losses from the drop in Guggenheim High's long position.| Parametric Commodity vs. Clarion Partners Real | Parametric Commodity vs. Lazard Global Listed | Parametric Commodity vs. Blackrock Commodity Strategies | Parametric Commodity vs. Franklin High Yield |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |