Correlation Between Invesco High and IHIT
Can any of the company-specific risk be diversified away by investing in both Invesco High and IHIT 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 Invesco High and IHIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco High Income and IHIT, you can compare the effects of market volatilities on Invesco High and IHIT 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 Invesco High with a short position of IHIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco High and IHIT.
Diversification Opportunities for Invesco High and IHIT
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Invesco and IHIT is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Invesco High Income and IHIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHIT and Invesco High 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 Invesco High Income are associated (or correlated) with IHIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHIT has no effect on the direction of Invesco High i.e., Invesco High and IHIT go up and down completely randomly.
Pair Corralation between Invesco High and IHIT
If you would invest 745.00 in IHIT on November 3, 2024 and sell it today you would earn a total of 0.00 from holding IHIT or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco High Income vs. IHIT
Performance |
| Timeline |
| Invesco High Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| IHIT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Invesco High and IHIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco High and IHIT
The main advantage of trading using opposite Invesco High and IHIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco High position performs unexpectedly, IHIT 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 IHIT will offset losses from the drop in IHIT's long position.| Invesco High vs. MFS Investment Grade | Invesco High vs. Eaton Vance National | Invesco High vs. Nuveen California Select | Invesco High vs. Federated Premier Municipal |
| IHIT vs. MFS Investment Grade | IHIT vs. Eaton Vance National | IHIT vs. Nuveen California Select | IHIT vs. Federated Premier Municipal |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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