Correlation Between Gurtin California and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Gurtin California and Ashmore Emerging 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 Gurtin California and Ashmore Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gurtin California Municipal and Ashmore Emerging Markets, you can compare the effects of market volatilities on Gurtin California and Ashmore Emerging 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 Gurtin California with a short position of Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gurtin California and Ashmore Emerging.
Diversification Opportunities for Gurtin California and Ashmore Emerging
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gurtin and Ashmore is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Gurtin California Municipal and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets and Gurtin California 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 Gurtin California Municipal are associated (or correlated) with Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Gurtin California i.e., Gurtin California and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Gurtin California and Ashmore Emerging
Assuming the 90 days horizon Gurtin California Municipal is expected to generate 0.62 times more return on investment than Ashmore Emerging. However, Gurtin California Municipal is 1.62 times less risky than Ashmore Emerging. It trades about -0.4 of its potential returns per unit of risk. Ashmore Emerging Markets is currently generating about -0.3 per unit of risk. If you would invest 994.00 in Gurtin California Municipal on October 12, 2024 and sell it today you would lose (17.00) from holding Gurtin California Municipal or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gurtin California Municipal vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Gurtin California |
| Ashmore Emerging Markets |
Gurtin California and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gurtin California and Ashmore Emerging
The main advantage of trading using opposite Gurtin California and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gurtin California position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging's long position.| Gurtin California vs. Fidelity New Markets | Gurtin California vs. Origin Emerging Markets | Gurtin California vs. Ashmore Emerging Markets | Gurtin California vs. Oshaughnessy Market Leaders |
| Ashmore Emerging vs. Qs Moderate Growth | Ashmore Emerging vs. Transamerica Cleartrack Retirement | Ashmore Emerging vs. Qs Moderate Growth | Ashmore Emerging vs. Columbia Moderate Growth |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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