Correlation Between Elfun Income and 361 Global
Can any of the company-specific risk be diversified away by investing in both Elfun Income and 361 Global 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 Income and 361 Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elfun Income Fund and 361 Global Longshort, you can compare the effects of market volatilities on Elfun Income and 361 Global 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 Income with a short position of 361 Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Income and 361 Global.
Diversification Opportunities for Elfun Income and 361 Global
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Elfun and 361 is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Income Fund and 361 Global Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 361 Global Longshort and Elfun Income 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 Income Fund are associated (or correlated) with 361 Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 361 Global Longshort has no effect on the direction of Elfun Income i.e., Elfun Income and 361 Global go up and down completely randomly.
Pair Corralation between Elfun Income and 361 Global
Assuming the 90 days horizon Elfun Income Fund is expected to under-perform the 361 Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, Elfun Income Fund is 1.15 times less risky than 361 Global. The mutual fund trades about -0.12 of its potential returns per unit of risk. The 361 Global Longshort is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,256 in 361 Global Longshort on September 12, 2024 and sell it today you would earn a total of 19.00 from holding 361 Global Longshort or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elfun Income Fund vs. 361 Global Longshort
Performance |
| Timeline |
| Elfun Income |
| 361 Global Longshort |
Elfun Income and 361 Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elfun Income and 361 Global
The main advantage of trading using opposite Elfun Income and 361 Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun Income position performs unexpectedly, 361 Global 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 361 Global will offset losses from the drop in 361 Global's long position.| Elfun Income vs. Metropolitan West Total | Elfun Income vs. SCOR PK | Elfun Income vs. Morningstar Unconstrained Allocation | Elfun Income vs. Thrivent High Yield |
| 361 Global vs. Ab Bond Inflation | 361 Global vs. Alliancebernstein National Municipal | 361 Global vs. Bbh Intermediate Municipal | 361 Global vs. Artisan High Income |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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