Correlation Between Invesco High and DWS Municipal
Can any of the company-specific risk be diversified away by investing in both Invesco High and DWS Municipal 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 DWS Municipal 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 DWS Municipal Income, you can compare the effects of market volatilities on Invesco High and DWS Municipal 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 DWS Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco High and DWS Municipal.
Diversification Opportunities for Invesco High and DWS Municipal
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Invesco and DWS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Invesco High Income and DWS Municipal Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DWS Municipal Income 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 DWS Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DWS Municipal Income has no effect on the direction of Invesco High i.e., Invesco High and DWS Municipal go up and down completely randomly.
Pair Corralation between Invesco High and DWS Municipal
If you would invest 950.00 in DWS Municipal Income on November 9, 2024 and sell it today you would earn a total of 13.00 from holding DWS Municipal Income or generate 1.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Invesco High Income vs. DWS Municipal Income
Performance |
| Timeline |
| Invesco High Income |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| DWS Municipal Income |
Invesco High and DWS Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco High and DWS Municipal
The main advantage of trading using opposite Invesco High and DWS Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco High position performs unexpectedly, DWS Municipal 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 DWS Municipal will offset losses from the drop in DWS Municipal'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 |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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