Correlation Between First Investors and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both First Investors and Arrow Managed 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 Investors and Arrow Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Investors Total and Arrow Managed Futures, you can compare the effects of market volatilities on First Investors and Arrow Managed 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 Investors with a short position of Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Investors and Arrow Managed.
Diversification Opportunities for First Investors and Arrow Managed
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Arrow is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding First Investors Total and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures and First Investors 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 Investors Total are associated (or correlated) with Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of First Investors i.e., First Investors and Arrow Managed go up and down completely randomly.
Pair Corralation between First Investors and Arrow Managed
If you would invest 525.00 in Arrow Managed Futures on September 1, 2024 and sell it today you would earn a total of 33.00 from holding Arrow Managed Futures or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
First Investors Total vs. Arrow Managed Futures
Performance |
| Timeline |
| First Investors Total |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Arrow Managed Futures |
First Investors and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Investors and Arrow Managed
The main advantage of trading using opposite First Investors and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Investors position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| First Investors vs. Arrow Managed Futures | First Investors vs. Falcon Focus Scv | First Investors vs. Iaadx | First Investors vs. Rbb Fund |
| Arrow Managed vs. Arrow Dwa Tactical | Arrow Managed vs. Arrow Dwa Tactical | Arrow Managed vs. Vanguard 500 Index | Arrow Managed vs. Allspring Global Dividend |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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