Correlation Between First Trust and Morgan Creek
Can any of the company-specific risk be diversified away by investing in both First Trust and Morgan Creek 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 Morgan Creek 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 Morgan Creek Capital, you can compare the effects of market volatilities on First Trust and Morgan Creek 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 Morgan Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Morgan Creek.
Diversification Opportunities for First Trust and Morgan Creek
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and Morgan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Small and Morgan Creek Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morgan Creek Capital 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 Morgan Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morgan Creek Capital has no effect on the direction of First Trust i.e., First Trust and Morgan Creek go up and down completely randomly.
Pair Corralation between First Trust and Morgan Creek
If you would invest 5,391 in First Trust Small on September 3, 2024 and sell it today you would earn a total of 615.00 from holding First Trust Small or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
First Trust Small vs. Morgan Creek Capital
Performance |
| Timeline |
| First Trust Small |
| Morgan Creek Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
First Trust and Morgan Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Morgan Creek
The main advantage of trading using opposite First Trust and Morgan Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Morgan Creek 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 Morgan Creek will offset losses from the drop in Morgan Creek's long position.| First Trust vs. First Trust Mid | First Trust vs. First Trust Small | First Trust vs. First Trust Mid | First Trust vs. First Trust Small |
| Morgan Creek vs. First Trust Mid | Morgan Creek vs. First Trust Small | Morgan Creek vs. First Trust Small | Morgan Creek vs. First Trust Mid |
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.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |