Correlation Between Federated Premier and Pioneer High
Can any of the company-specific risk be diversified away by investing in both Federated Premier and Pioneer High 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 Federated Premier and Pioneer High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Premier Municipal and Pioneer High Income, you can compare the effects of market volatilities on Federated Premier and Pioneer High 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 Federated Premier with a short position of Pioneer High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Premier and Pioneer High.
Diversification Opportunities for Federated Premier and Pioneer High
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Federated and Pioneer is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Federated Premier Municipal and Pioneer High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer High Income and Federated Premier 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 Federated Premier Municipal are associated (or correlated) with Pioneer High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer High Income has no effect on the direction of Federated Premier i.e., Federated Premier and Pioneer High go up and down completely randomly.
Pair Corralation between Federated Premier and Pioneer High
Considering the 90-day investment horizon Federated Premier is expected to generate 1.7 times less return on investment than Pioneer High. In addition to that, Federated Premier is 1.05 times more volatile than Pioneer High Income. It trades about 0.08 of its total potential returns per unit of risk. Pioneer High Income is currently generating about 0.15 per unit of volatility. If you would invest 595.00 in Pioneer High Income on September 12, 2024 and sell it today you would earn a total of 201.50 from holding Pioneer High Income or generate 33.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.7% |
| Values | Daily Returns |
Federated Premier Municipal vs. Pioneer High Income
Performance |
| Timeline |
| Federated Premier |
| Pioneer High Income |
Federated Premier and Pioneer High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Premier and Pioneer High
The main advantage of trading using opposite Federated Premier and Pioneer High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Premier position performs unexpectedly, Pioneer High 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 Pioneer High will offset losses from the drop in Pioneer High's long position.| Federated Premier vs. Oxford Lane Capital | Federated Premier vs. Orchid Island Capital | Federated Premier vs. Guggenheim Strategic Opportunities | Federated Premier vs. Stone Harbor Emerging |
| Pioneer High vs. MFS Investment Grade | Pioneer High vs. Eaton Vance National | Pioneer High vs. Federated Premier Municipal | Pioneer High vs. Gabelli Healthcare WellnessRx |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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