Correlation Between First Trust and Renaissance International
Can any of the company-specific risk be diversified away by investing in both First Trust and Renaissance International 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 Trust and Renaissance International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Small and Renaissance International IPO, you can compare the effects of market volatilities on First Trust and Renaissance International 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 Trust with a short position of Renaissance International. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Renaissance International.
Diversification Opportunities for First Trust and Renaissance International
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between First and Renaissance is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Small and Renaissance International IPO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renaissance International and First Trust 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 Trust Small are associated (or correlated) with Renaissance International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renaissance International has no effect on the direction of First Trust i.e., First Trust and Renaissance International go up and down completely randomly.
Pair Corralation between First Trust and Renaissance International
Considering the 90-day investment horizon First Trust is expected to generate 1.71 times less return on investment than Renaissance International. But when comparing it to its historical volatility, First Trust Small is 1.32 times less risky than Renaissance International. It trades about 0.17 of its potential returns per unit of risk. Renaissance International IPO is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,635 in Renaissance International IPO on December 2, 2025 and sell it today you would earn a total of 360.00 from holding Renaissance International IPO or generate 22.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.39% |
| Values | Daily Returns |
First Trust Small vs. Renaissance International IPO
Performance |
| Timeline |
| First Trust Small |
| Renaissance International |
First Trust and Renaissance International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Renaissance International
The main advantage of trading using opposite First Trust and Renaissance International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Renaissance International 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 Renaissance International will offset losses from the drop in Renaissance International's long position.| First Trust vs. WHITEWOLF Publicly Listed | First Trust vs. John Hancock Exchange Traded | First Trust vs. Allspring Exchange Traded Funds | First Trust vs. ProShares Equities for |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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