Correlation Between First Trustconfluence and First Trust
Can any of the company-specific risk be diversified away by investing in both First Trustconfluence and First Trust 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 Trustconfluence and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trustconfluence Small and First Trust Managed, you can compare the effects of market volatilities on First Trustconfluence and First Trust 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 Trustconfluence with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trustconfluence and First Trust.
Diversification Opportunities for First Trustconfluence and First Trust
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between First and First is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding First Trustconfluence Small and First Trust Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Managed and First Trustconfluence 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 Trustconfluence Small are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Managed has no effect on the direction of First Trustconfluence i.e., First Trustconfluence and First Trust go up and down completely randomly.
Pair Corralation between First Trustconfluence and First Trust
Assuming the 90 days horizon First Trustconfluence Small is expected to generate 5.63 times more return on investment than First Trust. However, First Trustconfluence is 5.63 times more volatile than First Trust Managed. It trades about 0.03 of its potential returns per unit of risk. First Trust Managed is currently generating about 0.09 per unit of risk. If you would invest 2,981 in First Trustconfluence Small on August 31, 2024 and sell it today you would earn a total of 360.00 from holding First Trustconfluence Small or generate 12.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trustconfluence Small vs. First Trust Managed
Performance |
| Timeline |
| First Trustconfluence |
| First Trust Managed |
First Trustconfluence and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trustconfluence and First Trust
The main advantage of trading using opposite First Trustconfluence and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trustconfluence position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| First Trustconfluence vs. Towpath Technology | First Trustconfluence vs. Columbia Global Technology | First Trustconfluence vs. Mfs Technology Fund | First Trustconfluence vs. Science Technology Fund |
| First Trust vs. Vanguard Intermediate Term Tax Exempt | First Trust vs. Tax Exempt Bond | First Trust vs. Blackrock National Municipal | First Trust vs. HUMANA INC |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |