Correlation Between Korea Closed and Guggenheim Alpha
Can any of the company-specific risk be diversified away by investing in both Korea Closed and Guggenheim Alpha 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 Korea Closed and Guggenheim Alpha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Closed and Guggenheim Alpha Opportunity, you can compare the effects of market volatilities on Korea Closed and Guggenheim Alpha 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 Korea Closed with a short position of Guggenheim Alpha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Closed and Guggenheim Alpha.
Diversification Opportunities for Korea Closed and Guggenheim Alpha
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Korea and Guggenheim is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Korea Closed and Guggenheim Alpha Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Alpha Opp and Korea Closed 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 Korea Closed are associated (or correlated) with Guggenheim Alpha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Alpha Opp has no effect on the direction of Korea Closed i.e., Korea Closed and Guggenheim Alpha go up and down completely randomly.
Pair Corralation between Korea Closed and Guggenheim Alpha
Allowing for the 90-day total investment horizon Korea Closed is expected to under-perform the Guggenheim Alpha. In addition to that, Korea Closed is 2.98 times more volatile than Guggenheim Alpha Opportunity. It trades about -0.19 of its total potential returns per unit of risk. Guggenheim Alpha Opportunity is currently generating about 0.26 per unit of volatility. If you would invest 2,215 in Guggenheim Alpha Opportunity on August 28, 2024 and sell it today you would earn a total of 60.00 from holding Guggenheim Alpha Opportunity or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Closed vs. Guggenheim Alpha Opportunity
Performance |
| Timeline |
| Korea Closed |
| Guggenheim Alpha Opp |
Korea Closed and Guggenheim Alpha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Closed and Guggenheim Alpha
The main advantage of trading using opposite Korea Closed and Guggenheim Alpha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Closed position performs unexpectedly, Guggenheim Alpha 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 Alpha will offset losses from the drop in Guggenheim Alpha's long position.| Korea Closed vs. Mexico Equity And | Korea Closed vs. Western Asset Global | Korea Closed vs. New Germany Closed | Korea Closed vs. MFS Charter Income |
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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 Stocks Directory module to find actively traded stocks across global markets.
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