Correlation Between First Trust and Guardian Ultra
Can any of the company-specific risk be diversified away by investing in both First Trust and Guardian Ultra 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 First Trust and Guardian Ultra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Indxx and Guardian Ultra Short Canadian, you can compare the effects of market volatilities on First Trust and Guardian Ultra 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 First Trust with a short position of Guardian Ultra. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Guardian Ultra.
Diversification Opportunities for First Trust and Guardian Ultra
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Guardian is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Indxx and Guardian Ultra Short Canadian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Ultra Short and First Trust 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 First Trust Indxx are associated (or correlated) with Guardian Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Ultra Short has no effect on the direction of First Trust i.e., First Trust and Guardian Ultra go up and down completely randomly.
Pair Corralation between First Trust and Guardian Ultra
If you would invest 4,993 in Guardian Ultra Short Canadian on September 13, 2024 and sell it today you would earn a total of 16.00 from holding Guardian Ultra Short Canadian or generate 0.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trust Indxx vs. Guardian Ultra Short Canadian
Performance |
| Timeline |
| First Trust Indxx |
| Guardian Ultra Short |
First Trust and Guardian Ultra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Guardian Ultra
The main advantage of trading using opposite First Trust and Guardian Ultra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Guardian Ultra 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 Guardian Ultra will offset losses from the drop in Guardian Ultra's long position.| First Trust vs. First Trust Indxx | First Trust vs. First Trust Senior | First Trust vs. First Trust AlphaDEX | First Trust vs. First Trust Indxx |
| Guardian Ultra vs. BetaPro SPTSX Capped | Guardian Ultra vs. BetaPro SPTSX 60 | Guardian Ultra vs. BetaPro SP 500 | Guardian Ultra vs. BetaPro NASDAQ 100 2x |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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