Correlation Between Federated Mdt and Natixis Sustainable
Can any of the company-specific risk be diversified away by investing in both Federated Mdt and Natixis Sustainable 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 Mdt and Natixis Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Mdt Large and Natixis Sustainable Future, you can compare the effects of market volatilities on Federated Mdt and Natixis Sustainable 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 Mdt with a short position of Natixis Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Mdt and Natixis Sustainable.
Diversification Opportunities for Federated Mdt and Natixis Sustainable
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between FEDERATED and Natixis is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Federated Mdt Large and Natixis Sustainable Future in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Sustainable and Federated Mdt 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 Mdt Large are associated (or correlated) with Natixis Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Sustainable has no effect on the direction of Federated Mdt i.e., Federated Mdt and Natixis Sustainable go up and down completely randomly.
Pair Corralation between Federated Mdt and Natixis Sustainable
Assuming the 90 days horizon Federated Mdt Large is expected to generate 1.57 times more return on investment than Natixis Sustainable. However, Federated Mdt is 1.57 times more volatile than Natixis Sustainable Future. It trades about 0.35 of its potential returns per unit of risk. Natixis Sustainable Future is currently generating about 0.18 per unit of risk. If you would invest 3,530 in Federated Mdt Large on August 28, 2024 and sell it today you would earn a total of 221.00 from holding Federated Mdt Large or generate 6.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Mdt Large vs. Natixis Sustainable Future
Performance |
| Timeline |
| Federated Mdt Large |
| Natixis Sustainable |
Federated Mdt and Natixis Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Mdt and Natixis Sustainable
The main advantage of trading using opposite Federated Mdt and Natixis Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Mdt position performs unexpectedly, Natixis Sustainable 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 Natixis Sustainable will offset losses from the drop in Natixis Sustainable's long position.| Federated Mdt vs. Federated Emerging Market | Federated Mdt vs. Federated Mdt All | Federated Mdt vs. Federated Mdt Balanced | Federated Mdt vs. Federated Global Allocation |
| Natixis Sustainable vs. Pace Large Growth | Natixis Sustainable vs. Tax Managed Large Cap | Natixis Sustainable vs. Federated Mdt Large | Natixis Sustainable vs. Rational Strategic Allocation |
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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