Correlation Between Lgm Risk and Federated Intermediate
Can any of the company-specific risk be diversified away by investing in both Lgm Risk and Federated Intermediate 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 Lgm Risk and Federated Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lgm Risk Managed and Federated Intermediate Porate, you can compare the effects of market volatilities on Lgm Risk and Federated Intermediate 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 Lgm Risk with a short position of Federated Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lgm Risk and Federated Intermediate.
Diversification Opportunities for Lgm Risk and Federated Intermediate
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lgm and Federated is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Lgm Risk Managed and Federated Intermediate Porate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Intermediate and Lgm Risk 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 Lgm Risk Managed are associated (or correlated) with Federated Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Intermediate has no effect on the direction of Lgm Risk i.e., Lgm Risk and Federated Intermediate go up and down completely randomly.
Pair Corralation between Lgm Risk and Federated Intermediate
Assuming the 90 days horizon Lgm Risk Managed is expected to generate 1.06 times more return on investment than Federated Intermediate. However, Lgm Risk is 1.06 times more volatile than Federated Intermediate Porate. It trades about 0.13 of its potential returns per unit of risk. Federated Intermediate Porate is currently generating about 0.06 per unit of risk. If you would invest 939.00 in Lgm Risk Managed on August 26, 2024 and sell it today you would earn a total of 205.00 from holding Lgm Risk Managed or generate 21.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lgm Risk Managed vs. Federated Intermediate Porate
Performance |
| Timeline |
| Lgm Risk Managed |
| Federated Intermediate |
Lgm Risk and Federated Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lgm Risk and Federated Intermediate
The main advantage of trading using opposite Lgm Risk and Federated Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lgm Risk position performs unexpectedly, Federated Intermediate 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 Federated Intermediate will offset losses from the drop in Federated Intermediate's long position.| Lgm Risk vs. Invesco Vertible Securities | Lgm Risk vs. Miller Vertible Bond | Lgm Risk vs. Franklin Vertible Securities | Lgm Risk vs. Victory Incore Investment |
| Federated Intermediate vs. Ab Global Risk | Federated Intermediate vs. Pace High Yield | Federated Intermediate vs. Calvert High Yield | Federated Intermediate vs. Lgm Risk Managed |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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