Correlation Between Ashmore Emerging and Small Pany
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Small Pany 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 Small Pany 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 Small Pany Value, you can compare the effects of market volatilities on Ashmore Emerging and Small Pany 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 Small Pany. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Small Pany.
Diversification Opportunities for Ashmore Emerging and Small Pany
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ashmore and Small is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Small Pany Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Pany Value 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 Small Pany. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Pany Value has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Small Pany go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Small Pany
Assuming the 90 days horizon Ashmore Emerging is expected to generate 3.58 times less return on investment than Small Pany. But when comparing it to its historical volatility, Ashmore Emerging Markets is 2.73 times less risky than Small Pany. It trades about 0.16 of its potential returns per unit of risk. Small Pany Value is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 3,020 in Small Pany Value on November 3, 2024 and sell it today you would earn a total of 118.00 from holding Small Pany Value or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Small Pany Value
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Small Pany Value |
Ashmore Emerging and Small Pany Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Small Pany
The main advantage of trading using opposite Ashmore Emerging and Small Pany positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Small Pany 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 Small Pany will offset losses from the drop in Small Pany's long position.| Ashmore Emerging vs. Specialized Technology Fund | Ashmore Emerging vs. Vanguard Information Technology | Ashmore Emerging vs. Blackrock Science Technology | Ashmore Emerging vs. Allianzgi Technology Fund |
| Small Pany vs. Scharf Global Opportunity | Small Pany vs. Qs Global Equity | Small Pany vs. Gmo Global Equity | Small Pany vs. Alliancebernstein Global Highome |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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