Correlation Between Shelton Emerging and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Shelton Emerging and Credit Suisse 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 Shelton Emerging and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shelton Emerging Markets and Credit Suisse Floating, you can compare the effects of market volatilities on Shelton Emerging and Credit Suisse 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 Shelton Emerging with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Emerging and Credit Suisse.
Diversification Opportunities for Shelton Emerging and Credit Suisse
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shelton and Credit is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Emerging Markets and Credit Suisse Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Floating and Shelton 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 Shelton Emerging Markets are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Floating has no effect on the direction of Shelton Emerging i.e., Shelton Emerging and Credit Suisse go up and down completely randomly.
Pair Corralation between Shelton Emerging and Credit Suisse
Assuming the 90 days horizon Shelton Emerging Markets is expected to under-perform the Credit Suisse. In addition to that, Shelton Emerging is 5.72 times more volatile than Credit Suisse Floating. It trades about -0.01 of its total potential returns per unit of risk. Credit Suisse Floating is currently generating about 0.12 per unit of volatility. If you would invest 622.00 in Credit Suisse Floating on September 3, 2024 and sell it today you would earn a total of 17.00 from holding Credit Suisse Floating or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelton Emerging Markets vs. Credit Suisse Floating
Performance |
| Timeline |
| Shelton Emerging Markets |
| Credit Suisse Floating |
Shelton Emerging and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Emerging and Credit Suisse
The main advantage of trading using opposite Shelton Emerging and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Emerging position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.The idea behind Shelton Emerging Markets and Credit Suisse Floating pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Credit Suisse vs. Oppenheimer Senior Floating | Credit Suisse vs. Oppenheimer Senior Floating | Credit Suisse vs. Floating Rate Fund | Credit Suisse vs. Floating Rate 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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