Correlation Between Shelton Emerging and Shelton Core
Can any of the company-specific risk be diversified away by investing in both Shelton Emerging and Shelton Core 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 Shelton Core 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 Shelton E Value, you can compare the effects of market volatilities on Shelton Emerging and Shelton Core 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 Shelton Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Emerging and Shelton Core.
Diversification Opportunities for Shelton Emerging and Shelton Core
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shelton and SHELTON is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Emerging Markets and Shelton E Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shelton E Value 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 Shelton Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shelton E Value has no effect on the direction of Shelton Emerging i.e., Shelton Emerging and Shelton Core go up and down completely randomly.
Pair Corralation between Shelton Emerging and Shelton Core
Assuming the 90 days horizon Shelton Emerging Markets is expected to under-perform the Shelton Core. In addition to that, Shelton Emerging is 1.4 times more volatile than Shelton E Value. It trades about -0.22 of its total potential returns per unit of risk. Shelton E Value is currently generating about 0.2 per unit of volatility. If you would invest 1,758 in Shelton E Value on August 29, 2024 and sell it today you would earn a total of 48.00 from holding Shelton E Value or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shelton Emerging Markets vs. Shelton E Value
Performance |
| Timeline |
| Shelton Emerging Markets |
| Shelton E Value |
Shelton Emerging and Shelton Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shelton Emerging and Shelton Core
The main advantage of trading using opposite Shelton Emerging and Shelton Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shelton Emerging position performs unexpectedly, Shelton Core 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 Shelton Core will offset losses from the drop in Shelton Core's long position.| Shelton Emerging vs. Astor Longshort Fund | Shelton Emerging vs. Sterling Capital Short | Shelton Emerging vs. Ambrus Core Bond | Shelton Emerging vs. Multisector Bond Sma |
| Shelton Core vs. Sp Smallcap Index | Shelton Core vs. Sp Midcap Index | Shelton Core vs. Sp 500 Index | Shelton Core vs. Us Government Securities |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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