Correlation Between Frost Low and Frost Kempner
Can any of the company-specific risk be diversified away by investing in both Frost Low and Frost Kempner 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 Frost Low and Frost Kempner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Frost Low Duration and Frost Kempner Multi Cap, you can compare the effects of market volatilities on Frost Low and Frost Kempner 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 Frost Low with a short position of Frost Kempner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Frost Low and Frost Kempner.
Diversification Opportunities for Frost Low and Frost Kempner
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Frost and Frost is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Frost Low Duration and Frost Kempner Multi Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frost Kempner Multi and Frost Low 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 Frost Low Duration are associated (or correlated) with Frost Kempner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frost Kempner Multi has no effect on the direction of Frost Low i.e., Frost Low and Frost Kempner go up and down completely randomly.
Pair Corralation between Frost Low and Frost Kempner
If you would invest 899.00 in Frost Low Duration on September 5, 2024 and sell it today you would earn a total of 87.00 from holding Frost Low Duration or generate 9.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.2% |
| Values | Daily Returns |
Frost Low Duration vs. Frost Kempner Multi Cap
Performance |
| Timeline |
| Frost Low Duration |
| Frost Kempner Multi |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Frost Low and Frost Kempner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Frost Low and Frost Kempner
The main advantage of trading using opposite Frost Low and Frost Kempner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Frost Low position performs unexpectedly, Frost Kempner 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 Frost Kempner will offset losses from the drop in Frost Kempner's long position.| Frost Low vs. Baird Ultra Short | Frost Low vs. Frost Total Return | Frost Low vs. Frost Growth Equity | Frost Low vs. Frost Kempner Multi Cap |
| Frost Kempner vs. Invesco Gold Special | Frost Kempner vs. Global Gold Fund | Frost Kempner vs. Europac Gold Fund | Frost Kempner vs. Fidelity Advisor Gold |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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