Correlation Between Ep Emerging and Strategic Alternatives
Can any of the company-specific risk be diversified away by investing in both Ep Emerging and Strategic Alternatives 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 Ep Emerging and Strategic Alternatives into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ep Emerging Markets and Strategic Alternatives Fund, you can compare the effects of market volatilities on Ep Emerging and Strategic Alternatives 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 Ep Emerging with a short position of Strategic Alternatives. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and Strategic Alternatives.
Diversification Opportunities for Ep Emerging and Strategic Alternatives
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EPEIX and Strategic is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and Strategic Alternatives Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Alternatives and Ep 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 Ep Emerging Markets are associated (or correlated) with Strategic Alternatives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Alternatives has no effect on the direction of Ep Emerging i.e., Ep Emerging and Strategic Alternatives go up and down completely randomly.
Pair Corralation between Ep Emerging and Strategic Alternatives
Assuming the 90 days horizon Ep Emerging Markets is expected to under-perform the Strategic Alternatives. In addition to that, Ep Emerging is 4.69 times more volatile than Strategic Alternatives Fund. It trades about -0.24 of its total potential returns per unit of risk. Strategic Alternatives Fund is currently generating about 0.16 per unit of volatility. If you would invest 978.00 in Strategic Alternatives Fund on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Strategic Alternatives Fund or generate 1.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ep Emerging Markets vs. Strategic Alternatives Fund
Performance |
| Timeline |
| Ep Emerging Markets |
| Strategic Alternatives |
Ep Emerging and Strategic Alternatives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ep Emerging and Strategic Alternatives
The main advantage of trading using opposite Ep Emerging and Strategic Alternatives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ep Emerging position performs unexpectedly, Strategic Alternatives 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 Strategic Alternatives will offset losses from the drop in Strategic Alternatives' long position.| Ep Emerging vs. Franklin Mutual Global | Ep Emerging vs. Templeton Growth Fund | Ep Emerging vs. Franklin Real Estate | Ep Emerging vs. HUMANA INC |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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