Correlation Between Emerging Europe and Driehaus Emerging
Can any of the company-specific risk be diversified away by investing in both Emerging Europe and Driehaus Emerging 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 Emerging Europe and Driehaus Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Europe Fund and Driehaus Emerging Markets, you can compare the effects of market volatilities on Emerging Europe and Driehaus Emerging 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 Emerging Europe with a short position of Driehaus Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Europe and Driehaus Emerging.
Diversification Opportunities for Emerging Europe and Driehaus Emerging
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Driehaus is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Europe Fund and Driehaus Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Driehaus Emerging Markets and Emerging Europe 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 Emerging Europe Fund are associated (or correlated) with Driehaus Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Driehaus Emerging Markets has no effect on the direction of Emerging Europe i.e., Emerging Europe and Driehaus Emerging go up and down completely randomly.
Pair Corralation between Emerging Europe and Driehaus Emerging
Assuming the 90 days horizon Emerging Europe Fund is expected to generate 1.34 times more return on investment than Driehaus Emerging. However, Emerging Europe is 1.34 times more volatile than Driehaus Emerging Markets. It trades about 0.08 of its potential returns per unit of risk. Driehaus Emerging Markets is currently generating about 0.04 per unit of risk. If you would invest 355.00 in Emerging Europe Fund on August 30, 2024 and sell it today you would earn a total of 50.00 from holding Emerging Europe Fund or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 31.31% |
| Values | Daily Returns |
Emerging Europe Fund vs. Driehaus Emerging Markets
Performance |
| Timeline |
| Emerging Europe |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Driehaus Emerging Markets |
Emerging Europe and Driehaus Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Europe and Driehaus Emerging
The main advantage of trading using opposite Emerging Europe and Driehaus Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Europe position performs unexpectedly, Driehaus Emerging 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 Driehaus Emerging will offset losses from the drop in Driehaus Emerging's long position.| Emerging Europe vs. Harbor Diversified International | Emerging Europe vs. Adams Diversified Equity | Emerging Europe vs. Guggenheim Diversified Income | Emerging Europe vs. Lord Abbett Diversified |
| Driehaus Emerging vs. Gabelli Global Financial | Driehaus Emerging vs. Pimco Capital Sec | Driehaus Emerging vs. Financial Industries Fund | Driehaus Emerging vs. Blackrock Financial Institutions |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |