Correlation Between First Investors and Manning Napier
Can any of the company-specific risk be diversified away by investing in both First Investors and Manning Napier 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 Manning Napier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Investors Opportunity and Manning Napier Credit, you can compare the effects of market volatilities on First Investors and Manning Napier 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 Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Investors and Manning Napier.
Diversification Opportunities for First Investors and Manning Napier
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Manning is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding First Investors Opportunity and Manning Napier Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier Credit 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 Opportunity are associated (or correlated) with Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier Credit has no effect on the direction of First Investors i.e., First Investors and Manning Napier go up and down completely randomly.
Pair Corralation between First Investors and Manning Napier
Assuming the 90 days horizon First Investors Opportunity is expected to generate 3.4 times more return on investment than Manning Napier. However, First Investors is 3.4 times more volatile than Manning Napier Credit. It trades about 0.31 of its potential returns per unit of risk. Manning Napier Credit is currently generating about 0.05 per unit of risk. If you would invest 3,378 in First Investors Opportunity on October 20, 2024 and sell it today you would earn a total of 167.00 from holding First Investors Opportunity or generate 4.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Investors Opportunity vs. Manning Napier Credit
Performance |
| Timeline |
| First Investors Oppo |
| Manning Napier Credit |
First Investors and Manning Napier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Investors and Manning Napier
The main advantage of trading using opposite First Investors and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Investors position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier's long position.| First Investors vs. Old Westbury Municipal | First Investors vs. Pioneer Amt Free Municipal | First Investors vs. Ab Municipal Bond | First Investors vs. American High Income Municipal |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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