Correlation Between Kip McGrath and Alternative Investment
Can any of the company-specific risk be diversified away by investing in both Kip McGrath and Alternative Investment 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 Kip McGrath and Alternative Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kip McGrath Education and Alternative Investment Trust, you can compare the effects of market volatilities on Kip McGrath and Alternative Investment 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 Kip McGrath with a short position of Alternative Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kip McGrath and Alternative Investment.
Diversification Opportunities for Kip McGrath and Alternative Investment
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kip and Alternative is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kip McGrath Education and Alternative Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternative Investment and Kip McGrath 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 Kip McGrath Education are associated (or correlated) with Alternative Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternative Investment has no effect on the direction of Kip McGrath i.e., Kip McGrath and Alternative Investment go up and down completely randomly.
Pair Corralation between Kip McGrath and Alternative Investment
Assuming the 90 days trading horizon Kip McGrath Education is expected to under-perform the Alternative Investment. In addition to that, Kip McGrath is 1.99 times more volatile than Alternative Investment Trust. It trades about -0.01 of its total potential returns per unit of risk. Alternative Investment Trust is currently generating about 0.06 per unit of volatility. If you would invest 88.00 in Alternative Investment Trust on August 28, 2024 and sell it today you would earn a total of 57.00 from holding Alternative Investment Trust or generate 64.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kip McGrath Education vs. Alternative Investment Trust
Performance |
| Timeline |
| Kip McGrath Education |
| Alternative Investment |
Kip McGrath and Alternative Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kip McGrath and Alternative Investment
The main advantage of trading using opposite Kip McGrath and Alternative Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kip McGrath position performs unexpectedly, Alternative Investment 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 Alternative Investment will offset losses from the drop in Alternative Investment's long position.| Kip McGrath vs. Actinogen Medical | Kip McGrath vs. Hutchison Telecommunications | Kip McGrath vs. Hotel Property Investments | Kip McGrath vs. G8 Education |
| Alternative Investment vs. National Australia Bank | Alternative Investment vs. National Australia Bank | Alternative Investment vs. Westpac Banking | Alternative Investment vs. National Australia Bank |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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