Correlation Between Federated Kaufmann and Lifex Income
Can any of the company-specific risk be diversified away by investing in both Federated Kaufmann and Lifex Income 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 Federated Kaufmann and Lifex Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Kaufmann Large and Lifex Income, you can compare the effects of market volatilities on Federated Kaufmann and Lifex Income 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 Federated Kaufmann with a short position of Lifex Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Kaufmann and Lifex Income.
Diversification Opportunities for Federated Kaufmann and Lifex Income
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FEDERATED and Lifex is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Federated Kaufmann Large and Lifex Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifex Income and Federated Kaufmann 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 Federated Kaufmann Large are associated (or correlated) with Lifex Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifex Income has no effect on the direction of Federated Kaufmann i.e., Federated Kaufmann and Lifex Income go up and down completely randomly.
Pair Corralation between Federated Kaufmann and Lifex Income
If you would invest 1,862 in Federated Kaufmann Large on September 1, 2024 and sell it today you would earn a total of 137.00 from holding Federated Kaufmann Large or generate 7.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Federated Kaufmann Large vs. Lifex Income
Performance |
| Timeline |
| Federated Kaufmann Large |
| Lifex Income |
Federated Kaufmann and Lifex Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Kaufmann and Lifex Income
The main advantage of trading using opposite Federated Kaufmann and Lifex Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Kaufmann position performs unexpectedly, Lifex Income 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 Lifex Income will offset losses from the drop in Lifex Income's long position.| Federated Kaufmann vs. Federated Emerging Market | Federated Kaufmann vs. Federated Mdt All | Federated Kaufmann vs. Federated Mdt Balanced | Federated Kaufmann vs. Federated Global Allocation |
| Lifex Income vs. T Rowe Price | Lifex Income vs. Legg Mason Bw | Lifex Income vs. Old Westbury Large | Lifex Income vs. Federated Kaufmann Large |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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