Correlation Between International Growth and Inflation Protected
Can any of the company-specific risk be diversified away by investing in both International Growth and Inflation Protected 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 International Growth and Inflation Protected into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Growth And and Inflation Protected Bond Fund, you can compare the effects of market volatilities on International Growth and Inflation Protected 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 International Growth with a short position of Inflation Protected. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Growth and Inflation Protected.
Diversification Opportunities for International Growth and Inflation Protected
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and Inflation is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding International Growth And and Inflation Protected Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflation Protected and International Growth 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 International Growth And are associated (or correlated) with Inflation Protected. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflation Protected has no effect on the direction of International Growth i.e., International Growth and Inflation Protected go up and down completely randomly.
Pair Corralation between International Growth and Inflation Protected
Assuming the 90 days horizon International Growth And is expected to generate 1.69 times more return on investment than Inflation Protected. However, International Growth is 1.69 times more volatile than Inflation Protected Bond Fund. It trades about 0.25 of its potential returns per unit of risk. Inflation Protected Bond Fund is currently generating about 0.07 per unit of risk. If you would invest 3,593 in International Growth And on November 4, 2024 and sell it today you would earn a total of 135.00 from holding International Growth And or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Growth And vs. Inflation Protected Bond Fund
Performance |
| Timeline |
| International Growth And |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Inflation Protected |
International Growth and Inflation Protected Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Growth and Inflation Protected
The main advantage of trading using opposite International Growth and Inflation Protected positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Growth position performs unexpectedly, Inflation Protected 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 Inflation Protected will offset losses from the drop in Inflation Protected's long position.| International Growth vs. Columbia Convertible Securities | International Growth vs. Advent Claymore Convertible | International Growth vs. Virtus Convertible | International Growth vs. Lord Abbett Convertible |
| Inflation Protected vs. Wells Fargo Advantage | Inflation Protected vs. Wells Fargo Advantage | Inflation Protected vs. Wells Fargo Advantage | Inflation Protected vs. Wells Fargo Advantage |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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