Correlation Between Elfun International and Elfun Trusts
Can any of the company-specific risk be diversified away by investing in both Elfun International and Elfun Trusts 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 Elfun International and Elfun Trusts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elfun International Equity and Elfun Trusts Elfun, you can compare the effects of market volatilities on Elfun International and Elfun Trusts 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 Elfun International with a short position of Elfun Trusts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun International and Elfun Trusts.
Diversification Opportunities for Elfun International and Elfun Trusts
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elfun and Elfun is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Elfun International Equity and Elfun Trusts Elfun in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elfun Trusts Elfun and Elfun International 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 Elfun International Equity are associated (or correlated) with Elfun Trusts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elfun Trusts Elfun has no effect on the direction of Elfun International i.e., Elfun International and Elfun Trusts go up and down completely randomly.
Pair Corralation between Elfun International and Elfun Trusts
Assuming the 90 days horizon Elfun International Equity is expected to generate 1.07 times more return on investment than Elfun Trusts. However, Elfun International is 1.07 times more volatile than Elfun Trusts Elfun. It trades about 0.16 of its potential returns per unit of risk. Elfun Trusts Elfun is currently generating about 0.11 per unit of risk. If you would invest 2,599 in Elfun International Equity on September 13, 2024 and sell it today you would earn a total of 58.00 from holding Elfun International Equity or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Elfun International Equity vs. Elfun Trusts Elfun
Performance |
| Timeline |
| Elfun International |
| Elfun Trusts Elfun |
Elfun International and Elfun Trusts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elfun International and Elfun Trusts
The main advantage of trading using opposite Elfun International and Elfun Trusts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun International position performs unexpectedly, Elfun Trusts 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 Elfun Trusts will offset losses from the drop in Elfun Trusts' long position.| Elfun International vs. State Street Target | Elfun International vs. State Street Target | Elfun International vs. Ssga International Stock | Elfun International vs. State Street Target |
| Elfun Trusts vs. T Rowe Price | Elfun Trusts vs. Kinetics Market Opportunities | Elfun Trusts vs. Barings Emerging Markets | Elfun Trusts vs. Calvert Developed Market |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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