Correlation Between International Small and Cref Money
Can any of the company-specific risk be diversified away by investing in both International Small and Cref Money 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 International Small and Cref Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Small Cap and Cref Money Market, you can compare the effects of market volatilities on International Small and Cref Money 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 International Small with a short position of Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Small and Cref Money.
Diversification Opportunities for International Small and Cref Money
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and Cref is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding International Small Cap and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market and International Small 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 International Small Cap are associated (or correlated) with Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of International Small i.e., International Small and Cref Money go up and down completely randomly.
Pair Corralation between International Small and Cref Money
Assuming the 90 days horizon International Small Cap is expected to generate 41.09 times more return on investment than Cref Money. However, International Small is 41.09 times more volatile than Cref Money Market. It trades about 0.06 of its potential returns per unit of risk. Cref Money Market is currently generating about 0.97 per unit of risk. If you would invest 1,117 in International Small Cap on November 3, 2024 and sell it today you would earn a total of 67.00 from holding International Small Cap or generate 6.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Small Cap vs. Cref Money Market
Performance |
| Timeline |
| International Small Cap |
| Cref Money Market |
International Small and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Small and Cref Money
The main advantage of trading using opposite International Small and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Small position performs unexpectedly, Cref Money 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 Cref Money will offset losses from the drop in Cref Money's long position.| International Small vs. Wmcanx | International Small vs. Fznopx | International Small vs. Fabwx | International Small vs. Abr 7525 Volatility |
| Cref Money vs. Short Real Estate | Cref Money vs. Nexpoint Real Estate | Cref Money vs. Jhancock Real Estate | Cref Money vs. Tiaa Cref Real Estate |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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