Correlation Between Elfun Diversified and Invesco Peak
Can any of the company-specific risk be diversified away by investing in both Elfun Diversified and Invesco Peak 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 Diversified and Invesco Peak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elfun Diversified Fund and Invesco Peak Retirement, you can compare the effects of market volatilities on Elfun Diversified and Invesco Peak 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 Diversified with a short position of Invesco Peak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Diversified and Invesco Peak.
Diversification Opportunities for Elfun Diversified and Invesco Peak
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Elfun and Invesco is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Diversified Fund and Invesco Peak Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Peak Retirement and Elfun Diversified 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 Diversified Fund are associated (or correlated) with Invesco Peak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Peak Retirement has no effect on the direction of Elfun Diversified i.e., Elfun Diversified and Invesco Peak go up and down completely randomly.
Pair Corralation between Elfun Diversified and Invesco Peak
Assuming the 90 days horizon Elfun Diversified Fund is expected to generate 3.81 times more return on investment than Invesco Peak. However, Elfun Diversified is 3.81 times more volatile than Invesco Peak Retirement. It trades about 0.11 of its potential returns per unit of risk. Invesco Peak Retirement is currently generating about -0.03 per unit of risk. If you would invest 1,664 in Elfun Diversified Fund on September 12, 2024 and sell it today you would earn a total of 538.00 from holding Elfun Diversified Fund or generate 32.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.87% |
| Values | Daily Returns |
Elfun Diversified Fund vs. Invesco Peak Retirement
Performance |
| Timeline |
| Elfun Diversified |
| Invesco Peak Retirement |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Elfun Diversified and Invesco Peak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elfun Diversified and Invesco Peak
The main advantage of trading using opposite Elfun Diversified and Invesco Peak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun Diversified position performs unexpectedly, Invesco Peak 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 Invesco Peak will offset losses from the drop in Invesco Peak's long position.| Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of |
| Invesco Peak vs. Elfun Diversified Fund | Invesco Peak vs. Lord Abbett Diversified | Invesco Peak vs. Western Asset Diversified | Invesco Peak vs. Wilmington Diversified 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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