Correlation Between Kensington Active and Guggenheim Diversified
Can any of the company-specific risk be diversified away by investing in both Kensington Active and Guggenheim Diversified 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 Kensington Active and Guggenheim Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kensington Active Advantage and Guggenheim Diversified Income, you can compare the effects of market volatilities on Kensington Active and Guggenheim Diversified 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 Kensington Active with a short position of Guggenheim Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kensington Active and Guggenheim Diversified.
Diversification Opportunities for Kensington Active and Guggenheim Diversified
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kensington and Guggenheim is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kensington Active Advantage and Guggenheim Diversified Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Diversified and Kensington Active 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 Kensington Active Advantage are associated (or correlated) with Guggenheim Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Diversified has no effect on the direction of Kensington Active i.e., Kensington Active and Guggenheim Diversified go up and down completely randomly.
Pair Corralation between Kensington Active and Guggenheim Diversified
If you would invest 990.00 in Kensington Active Advantage on September 2, 2024 and sell it today you would earn a total of 31.00 from holding Kensington Active Advantage or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kensington Active Advantage vs. Guggenheim Diversified Income
Performance |
| Timeline |
| Kensington Active |
| Guggenheim Diversified |
Kensington Active and Guggenheim Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kensington Active and Guggenheim Diversified
The main advantage of trading using opposite Kensington Active and Guggenheim Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kensington Active position performs unexpectedly, Guggenheim Diversified 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 Guggenheim Diversified will offset losses from the drop in Guggenheim Diversified's long position.| Kensington Active vs. Deutsche Health And | Kensington Active vs. Baillie Gifford Health | Kensington Active vs. Alphacentric Lifesci Healthcare | Kensington Active vs. Alger Health Sciences |
| Guggenheim Diversified vs. Blrc Sgy Mnp | Guggenheim Diversified vs. Alliancebernstein National Municipal | Guggenheim Diversified vs. Ishares Municipal Bond | Guggenheim Diversified vs. Franklin High Yield |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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