Correlation Between Shelton Emerging and Floating Rate
Can any of the company-specific risk be diversified away by investing in both Shelton Emerging and Floating Rate 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 Floating Rate 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 Floating Rate Fund, you can compare the effects of market volatilities on Shelton Emerging and Floating Rate 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 Floating Rate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Emerging and Floating Rate.
Diversification Opportunities for Shelton Emerging and Floating Rate
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shelton and Floating is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Emerging Markets and Floating Rate Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Floating Rate 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 Floating Rate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Floating Rate has no effect on the direction of Shelton Emerging i.e., Shelton Emerging and Floating Rate go up and down completely randomly.
Pair Corralation between Shelton Emerging and Floating Rate
Assuming the 90 days horizon Shelton Emerging is expected to generate 2.18 times less return on investment than Floating Rate. In addition to that, Shelton Emerging is 5.58 times more volatile than Floating Rate Fund. It trades about 0.02 of its total potential returns per unit of risk. Floating Rate Fund is currently generating about 0.23 per unit of volatility. If you would invest 674.00 in Floating Rate Fund on September 14, 2024 and sell it today you would earn a total of 145.00 from holding Floating Rate Fund or generate 21.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelton Emerging Markets vs. Floating Rate Fund
Performance |
| Timeline |
| Shelton Emerging Markets |
| Floating Rate |
Shelton Emerging and Floating Rate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Emerging and Floating Rate
The main advantage of trading using opposite Shelton Emerging and Floating Rate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Emerging position performs unexpectedly, Floating Rate 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 Floating Rate will offset losses from the drop in Floating Rate's long position.| Shelton Emerging vs. Shelton Emerging Markets | Shelton Emerging vs. California Tax Free Income | Shelton Emerging vs. Shelton Funds | Shelton Emerging vs. Nasdaq 100 Index Fund |
| Floating Rate vs. Mid Cap 15x Strategy | Floating Rate vs. Transamerica Emerging Markets | Floating Rate vs. Origin Emerging Markets | Floating Rate vs. Shelton Emerging Markets |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |