Correlation Between Financial Investors and IXSE
Can any of the company-specific risk be diversified away by investing in both Financial Investors and IXSE 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 Financial Investors and IXSE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financial Investors Trust and IXSE, you can compare the effects of market volatilities on Financial Investors and IXSE 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 Financial Investors with a short position of IXSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial Investors and IXSE.
Diversification Opportunities for Financial Investors and IXSE
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Financial and IXSE is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Financial Investors Trust and IXSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IXSE and Financial Investors 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 Financial Investors Trust are associated (or correlated) with IXSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IXSE has no effect on the direction of Financial Investors i.e., Financial Investors and IXSE go up and down completely randomly.
Pair Corralation between Financial Investors and IXSE
If you would invest 2,063 in Financial Investors Trust on August 30, 2024 and sell it today you would earn a total of 24.00 from holding Financial Investors Trust or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Financial Investors Trust vs. IXSE
Performance |
| Timeline |
| Financial Investors Trust |
| IXSE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Financial Investors and IXSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial Investors and IXSE
The main advantage of trading using opposite Financial Investors and IXSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Investors position performs unexpectedly, IXSE 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 IXSE will offset losses from the drop in IXSE's long position.| Financial Investors vs. Alpskotak India Growth | Financial Investors vs. Alpskotak India Growth | Financial Investors vs. Alpskotak India Growth | Financial Investors vs. Alpskotak India Growth |
| IXSE vs. iShares India 50 | IXSE vs. iShares MSCI China | IXSE vs. VanEck Vietnam ETF | IXSE vs. iShares MSCI India |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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