Correlation Between Martin Currie and IndexIQ ETF
Can any of the company-specific risk be diversified away by investing in both Martin Currie and IndexIQ ETF 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 Martin Currie and IndexIQ ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Martin Currie Sustainable and IndexIQ ETF Trust, you can compare the effects of market volatilities on Martin Currie and IndexIQ ETF 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 Martin Currie with a short position of IndexIQ ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Martin Currie and IndexIQ ETF.
Diversification Opportunities for Martin Currie and IndexIQ ETF
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Martin and IndexIQ is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Martin Currie Sustainable and IndexIQ ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IndexIQ ETF Trust and Martin Currie 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 Martin Currie Sustainable are associated (or correlated) with IndexIQ ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IndexIQ ETF Trust has no effect on the direction of Martin Currie i.e., Martin Currie and IndexIQ ETF go up and down completely randomly.
Pair Corralation between Martin Currie and IndexIQ ETF
Given the investment horizon of 90 days Martin Currie Sustainable is expected to under-perform the IndexIQ ETF. In addition to that, Martin Currie is 1.21 times more volatile than IndexIQ ETF Trust. It trades about -0.27 of its total potential returns per unit of risk. IndexIQ ETF Trust is currently generating about 0.08 per unit of volatility. If you would invest 2,678 in IndexIQ ETF Trust on August 30, 2024 and sell it today you would earn a total of 34.00 from holding IndexIQ ETF Trust or generate 1.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 81.82% |
| Values | Daily Returns |
Martin Currie Sustainable vs. IndexIQ ETF Trust
Performance |
| Timeline |
| Martin Currie Sustainable |
| IndexIQ ETF Trust |
Martin Currie and IndexIQ ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Martin Currie and IndexIQ ETF
The main advantage of trading using opposite Martin Currie and IndexIQ ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Martin Currie position performs unexpectedly, IndexIQ ETF 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 IndexIQ ETF will offset losses from the drop in IndexIQ ETF's long position.| Martin Currie vs. BrandywineGLOBAL Dynamic | Martin Currie vs. First Trust Growth | Martin Currie vs. Invesco NASDAQ Future | Martin Currie vs. Burney Factor Rotation |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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