Correlation Between Ashmore Emerging and Harbor Diversified
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Harbor Diversified 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 Ashmore Emerging and Harbor Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Harbor Diversified International, you can compare the effects of market volatilities on Ashmore Emerging and Harbor Diversified 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 Ashmore Emerging with a short position of Harbor Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Harbor Diversified.
Diversification Opportunities for Ashmore Emerging and Harbor Diversified
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ashmore and Harbor is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Harbor Diversified Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Diversified and Ashmore Emerging 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 Ashmore Emerging Markets are associated (or correlated) with Harbor Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Diversified has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Harbor Diversified go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Harbor Diversified
Assuming the 90 days horizon Ashmore Emerging is expected to generate 1.14 times less return on investment than Harbor Diversified. But when comparing it to its historical volatility, Ashmore Emerging Markets is 2.06 times less risky than Harbor Diversified. It trades about 0.11 of its potential returns per unit of risk. Harbor Diversified International is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,170 in Harbor Diversified International on September 12, 2024 and sell it today you would earn a total of 141.00 from holding Harbor Diversified International or generate 12.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Harbor Diversified Internation
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Harbor Diversified |
Ashmore Emerging and Harbor Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Harbor Diversified
The main advantage of trading using opposite Ashmore Emerging and Harbor Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Harbor Diversified 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 Harbor Diversified will offset losses from the drop in Harbor Diversified's long position.| Ashmore Emerging vs. Live Oak Health | Ashmore Emerging vs. Baillie Gifford Health | Ashmore Emerging vs. Fidelity Advisor Health | Ashmore Emerging vs. Prudential Health Sciences |
| Harbor Diversified vs. Investec Emerging Markets | Harbor Diversified vs. Franklin Emerging Market | Harbor Diversified vs. Artisan Emerging Markets | Harbor Diversified vs. Transamerica Emerging Markets |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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