Correlation Between Gateway Fund and Swan Defined
Can any of the company-specific risk be diversified away by investing in both Gateway Fund and Swan Defined 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 Gateway Fund and Swan Defined into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gateway Fund Class and Swan Defined Risk, you can compare the effects of market volatilities on Gateway Fund and Swan Defined 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 Gateway Fund with a short position of Swan Defined. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gateway Fund and Swan Defined.
Diversification Opportunities for Gateway Fund and Swan Defined
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Gateway and Swan is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Gateway Fund Class and Swan Defined Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swan Defined Risk and Gateway Fund 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 Gateway Fund Class are associated (or correlated) with Swan Defined. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swan Defined Risk has no effect on the direction of Gateway Fund i.e., Gateway Fund and Swan Defined go up and down completely randomly.
Pair Corralation between Gateway Fund and Swan Defined
Assuming the 90 days horizon Gateway Fund is expected to generate 1.0 times less return on investment than Swan Defined. In addition to that, Gateway Fund is 1.15 times more volatile than Swan Defined Risk. It trades about 0.21 of its total potential returns per unit of risk. Swan Defined Risk is currently generating about 0.25 per unit of volatility. If you would invest 1,509 in Swan Defined Risk on September 2, 2024 and sell it today you would earn a total of 91.00 from holding Swan Defined Risk or generate 6.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gateway Fund Class vs. Swan Defined Risk
Performance |
| Timeline |
| Gateway Fund Class |
| Swan Defined Risk |
Gateway Fund and Swan Defined Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gateway Fund and Swan Defined
The main advantage of trading using opposite Gateway Fund and Swan Defined positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gateway Fund position performs unexpectedly, Swan Defined 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 Swan Defined will offset losses from the drop in Swan Defined's long position.| Gateway Fund vs. Principal Lifetime Hybrid | Gateway Fund vs. Davenport Small Cap | Gateway Fund vs. Delaware Limited Term Diversified | Gateway Fund vs. Sentinel Small Pany |
| Swan Defined vs. Adams Diversified Equity | Swan Defined vs. Pgim Conservative Retirement | Swan Defined vs. Delaware Limited Term Diversified | Swan Defined vs. Harbor Diversified International |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |