Correlation Between Federated Global and Columbia Seligman
Can any of the company-specific risk be diversified away by investing in both Federated Global and Columbia Seligman 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 Columbia Seligman 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 Columbia Seligman Global, you can compare the effects of market volatilities on Federated Global and Columbia Seligman 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 Columbia Seligman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Global and Columbia Seligman.
Diversification Opportunities for Federated Global and Columbia Seligman
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Federated and Columbia is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Federated Global Allocation and Columbia Seligman Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Seligman Global 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 Columbia Seligman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Seligman Global has no effect on the direction of Federated Global i.e., Federated Global and Columbia Seligman go up and down completely randomly.
Pair Corralation between Federated Global and Columbia Seligman
Assuming the 90 days horizon Federated Global Allocation is expected to generate 0.24 times more return on investment than Columbia Seligman. However, Federated Global Allocation is 4.13 times less risky than Columbia Seligman. It trades about 0.09 of its potential returns per unit of risk. Columbia Seligman Global is currently generating about 0.0 per unit of risk. If you would invest 1,938 in Federated Global Allocation on November 1, 2024 and sell it today you would earn a total of 54.00 from holding Federated Global Allocation or generate 2.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
Federated Global Allocation vs. Columbia Seligman Global
Performance |
| Timeline |
| Federated Global All |
| Columbia Seligman Global |
Federated Global and Columbia Seligman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Global and Columbia Seligman
The main advantage of trading using opposite Federated Global and Columbia Seligman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Global position performs unexpectedly, Columbia Seligman 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 Columbia Seligman will offset losses from the drop in Columbia Seligman'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 |
| Columbia Seligman vs. Inflation Adjusted Bond Fund | Columbia Seligman vs. Vanguard E Bond | Columbia Seligman vs. Morningstar Defensive Bond | Columbia Seligman vs. Blrc Sgy Mnp |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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