Correlation Between Guggenheim Macro and Nasdaq-100 Index
Can any of the company-specific risk be diversified away by investing in both Guggenheim Macro and Nasdaq-100 Index 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 Guggenheim Macro and Nasdaq-100 Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guggenheim Macro Opportunities and Nasdaq 100 Index Fund, you can compare the effects of market volatilities on Guggenheim Macro and Nasdaq-100 Index 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 Guggenheim Macro with a short position of Nasdaq-100 Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Macro and Nasdaq-100 Index.
Diversification Opportunities for Guggenheim Macro and Nasdaq-100 Index
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guggenheim and Nasdaq-100 is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Macro Opportunities and Nasdaq 100 Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 Index and Guggenheim Macro 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 Guggenheim Macro Opportunities are associated (or correlated) with Nasdaq-100 Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 Index has no effect on the direction of Guggenheim Macro i.e., Guggenheim Macro and Nasdaq-100 Index go up and down completely randomly.
Pair Corralation between Guggenheim Macro and Nasdaq-100 Index
Assuming the 90 days horizon Guggenheim Macro is expected to generate 1.55 times less return on investment than Nasdaq-100 Index. But when comparing it to its historical volatility, Guggenheim Macro Opportunities is 7.0 times less risky than Nasdaq-100 Index. It trades about 0.29 of its potential returns per unit of risk. Nasdaq 100 Index Fund is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5,199 in Nasdaq 100 Index Fund on November 27, 2024 and sell it today you would earn a total of 58.00 from holding Nasdaq 100 Index Fund or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guggenheim Macro Opportunities vs. Nasdaq 100 Index Fund
Performance |
| Timeline |
| Guggenheim Macro Opp |
| Nasdaq 100 Index |
Guggenheim Macro and Nasdaq-100 Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guggenheim Macro and Nasdaq-100 Index
The main advantage of trading using opposite Guggenheim Macro and Nasdaq-100 Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guggenheim Macro position performs unexpectedly, Nasdaq-100 Index 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 Nasdaq-100 Index will offset losses from the drop in Nasdaq-100 Index's long position.| Guggenheim Macro vs. T Rowe Price | Guggenheim Macro vs. John Hancock Money | Guggenheim Macro vs. Franklin Government Money | Guggenheim Macro vs. Aig Government Money |
| Nasdaq-100 Index vs. Aqr Managed Futures | Nasdaq-100 Index vs. Credit Suisse Multialternative | Nasdaq-100 Index vs. The Hartford Inflation | Nasdaq-100 Index vs. Simt Multi Asset Inflation |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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