Correlation Between Arrow Managed and Global E
Can any of the company-specific risk be diversified away by investing in both Arrow Managed and Global E 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 Arrow Managed and Global E into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrow Managed Futures and Global E Portfolio, you can compare the effects of market volatilities on Arrow Managed and Global E 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 Arrow Managed with a short position of Global E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrow Managed and Global E.
Diversification Opportunities for Arrow Managed and Global E
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Arrow and Global is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Arrow Managed Futures and Global E Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global E Portfolio and Arrow Managed 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 Arrow Managed Futures are associated (or correlated) with Global E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global E Portfolio has no effect on the direction of Arrow Managed i.e., Arrow Managed and Global E go up and down completely randomly.
Pair Corralation between Arrow Managed and Global E
Assuming the 90 days horizon Arrow Managed Futures is expected to generate 2.28 times more return on investment than Global E. However, Arrow Managed is 2.28 times more volatile than Global E Portfolio. It trades about 0.21 of its potential returns per unit of risk. Global E Portfolio is currently generating about 0.15 per unit of risk. If you would invest 546.00 in Arrow Managed Futures on September 14, 2024 and sell it today you would earn a total of 29.00 from holding Arrow Managed Futures or generate 5.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrow Managed Futures vs. Global E Portfolio
Performance |
| Timeline |
| Arrow Managed Futures |
| Global E Portfolio |
Arrow Managed and Global E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrow Managed and Global E
The main advantage of trading using opposite Arrow Managed and Global E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrow Managed position performs unexpectedly, Global E 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 Global E will offset losses from the drop in Global E's long position.| Arrow Managed vs. Money Market Obligations | Arrow Managed vs. Elfun Government Money | Arrow Managed vs. Hewitt Money Market | Arrow Managed vs. Putnam Money Market |
| Global E vs. Global Advantage Portfolio | Global E vs. Ridgeworth Innovative Growth | Global E vs. Transamerica Capital Growth | Global E vs. Internet Ultrasector Profund |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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