Correlation Between Ashmore Emerging and Pace Large
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Pace Large 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 Ashmore Emerging and Pace Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Pace Large Value, you can compare the effects of market volatilities on Ashmore Emerging and Pace Large 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 Ashmore Emerging with a short position of Pace Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Pace Large.
Diversification Opportunities for Ashmore Emerging and Pace Large
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ashmore and Pace is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Pace Large Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace Large Value and Ashmore Emerging 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 Ashmore Emerging Markets are associated (or correlated) with Pace Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace Large Value has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Pace Large go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Pace Large
Assuming the 90 days horizon Ashmore Emerging Markets is expected to generate 0.84 times more return on investment than Pace Large. However, Ashmore Emerging Markets is 1.19 times less risky than Pace Large. It trades about 0.13 of its potential returns per unit of risk. Pace Large Value is currently generating about -0.04 per unit of risk. If you would invest 1,016 in Ashmore Emerging Markets on September 14, 2024 and sell it today you would earn a total of 11.00 from holding Ashmore Emerging Markets or generate 1.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Pace Large Value
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Pace Large Value |
Ashmore Emerging and Pace Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Pace Large
The main advantage of trading using opposite Ashmore Emerging and Pace Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Pace Large 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 Pace Large will offset losses from the drop in Pace Large's long position.| Ashmore Emerging vs. Pace Large Value | Ashmore Emerging vs. Virtus Nfj Large Cap | Ashmore Emerging vs. Large Cap Growth Profund | Ashmore Emerging vs. American Mutual Fund |
| Pace Large vs. Pace Smallmedium Value | Pace Large vs. Pace International Equity | Pace Large vs. Pace International Equity | Pace Large vs. Ubs Allocation 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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