Correlation Between Huber Capital and International Opportunity
Can any of the company-specific risk be diversified away by investing in both Huber Capital and International Opportunity 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 Huber Capital and International Opportunity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huber Capital Diversified and International Opportunity Portfolio, you can compare the effects of market volatilities on Huber Capital and International Opportunity 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 Huber Capital with a short position of International Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huber Capital and International Opportunity.
Diversification Opportunities for Huber Capital and International Opportunity
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huber and International is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Huber Capital Diversified and International Opportunity Port in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Opportunity and Huber Capital 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 Huber Capital Diversified are associated (or correlated) with International Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Opportunity has no effect on the direction of Huber Capital i.e., Huber Capital and International Opportunity go up and down completely randomly.
Pair Corralation between Huber Capital and International Opportunity
Assuming the 90 days horizon Huber Capital Diversified is expected to generate 1.49 times more return on investment than International Opportunity. However, Huber Capital is 1.49 times more volatile than International Opportunity Portfolio. It trades about 0.25 of its potential returns per unit of risk. International Opportunity Portfolio is currently generating about 0.13 per unit of risk. If you would invest 2,369 in Huber Capital Diversified on September 1, 2024 and sell it today you would earn a total of 144.00 from holding Huber Capital Diversified or generate 6.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huber Capital Diversified vs. International Opportunity Port
Performance |
| Timeline |
| Huber Capital Diversified |
| International Opportunity |
Huber Capital and International Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huber Capital and International Opportunity
The main advantage of trading using opposite Huber Capital and International Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huber Capital position performs unexpectedly, International Opportunity 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 International Opportunity will offset losses from the drop in International Opportunity's long position.| Huber Capital vs. Aqr Long Short Equity | Huber Capital vs. Rbc Emerging Markets | Huber Capital vs. Ab All Market | Huber Capital vs. Aqr Sustainable Long Short |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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