Correlation Between Invesco Gold and Frost Kempner
Can any of the company-specific risk be diversified away by investing in both Invesco Gold and Frost Kempner 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 Gold and Frost Kempner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Gold Special and Frost Kempner Multi Cap, you can compare the effects of market volatilities on Invesco Gold and Frost Kempner 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 Gold with a short position of Frost Kempner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Gold and Frost Kempner.
Diversification Opportunities for Invesco Gold and Frost Kempner
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Invesco and Frost is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Gold Special and Frost Kempner Multi Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frost Kempner Multi and Invesco Gold 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 Gold Special are associated (or correlated) with Frost Kempner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frost Kempner Multi has no effect on the direction of Invesco Gold i.e., Invesco Gold and Frost Kempner go up and down completely randomly.
Pair Corralation between Invesco Gold and Frost Kempner
Assuming the 90 days horizon Invesco Gold Special is expected to generate 3.61 times more return on investment than Frost Kempner. However, Invesco Gold is 3.61 times more volatile than Frost Kempner Multi Cap. It trades about 0.26 of its potential returns per unit of risk. Frost Kempner Multi Cap is currently generating about -0.05 per unit of risk. If you would invest 2,723 in Invesco Gold Special on September 13, 2024 and sell it today you would earn a total of 251.00 from holding Invesco Gold Special or generate 9.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Gold Special vs. Frost Kempner Multi Cap
Performance |
| Timeline |
| Invesco Gold Special |
| Frost Kempner Multi |
Invesco Gold and Frost Kempner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Gold and Frost Kempner
The main advantage of trading using opposite Invesco Gold and Frost Kempner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Gold position performs unexpectedly, Frost Kempner 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 Frost Kempner will offset losses from the drop in Frost Kempner's long position.| Invesco Gold vs. Blackrock Sm Cap | Invesco Gold vs. Sentinel Small Pany | Invesco Gold vs. Wasatch Small Cap | Invesco Gold vs. Small Cap Stock |
| Frost Kempner vs. Frost Growth Equity | Frost Kempner vs. Frost Low Duration | Frost Kempner vs. Frost Total Return | Frost Kempner vs. Frost Kempner Treasury |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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