Correlation Between Federated Global and Brookfield Global
Can any of the company-specific risk be diversified away by investing in both Federated Global and Brookfield Global 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 Global and Brookfield Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Global Allocation and Brookfield Global Listed, you can compare the effects of market volatilities on Federated Global and Brookfield Global 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 Global with a short position of Brookfield Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Global and Brookfield Global.
Diversification Opportunities for Federated Global and Brookfield Global
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Federated and Brookfield is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Federated Global Allocation and Brookfield Global Listed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Global Listed and Federated Global 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 Global Allocation are associated (or correlated) with Brookfield Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Global Listed has no effect on the direction of Federated Global i.e., Federated Global and Brookfield Global go up and down completely randomly.
Pair Corralation between Federated Global and Brookfield Global
Assuming the 90 days horizon Federated Global Allocation is expected to generate 0.67 times more return on investment than Brookfield Global. However, Federated Global Allocation is 1.49 times less risky than Brookfield Global. It trades about 0.07 of its potential returns per unit of risk. Brookfield Global Listed is currently generating about 0.03 per unit of risk. If you would invest 1,699 in Federated Global Allocation on November 2, 2024 and sell it today you would earn a total of 300.00 from holding Federated Global Allocation or generate 17.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Global Allocation vs. Brookfield Global Listed
Performance |
| Timeline |
| Federated Global All |
| Brookfield Global Listed |
Federated Global and Brookfield Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Global and Brookfield Global
The main advantage of trading using opposite Federated Global and Brookfield Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Global position performs unexpectedly, Brookfield Global 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 Brookfield Global will offset losses from the drop in Brookfield Global's long position.| Federated Global vs. Federated Max Cap Index | Federated Global vs. Federated Kaufmann Fund | Federated Global vs. Federated Strategic Income | Federated Global vs. Federated Bond Fund |
| Brookfield Global vs. Virtus Seix Government | Brookfield Global vs. Schwab Government Money | Brookfield Global vs. Great West Government Mortgage | Brookfield Global vs. Wesmark Government Bond |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |