Correlation Between Manning Napier and College Retirement
Can any of the company-specific risk be diversified away by investing in both Manning Napier and College Retirement 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 Manning Napier and College Retirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manning Napier Diversified and College Retirement Equities, you can compare the effects of market volatilities on Manning Napier and College Retirement 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 Manning Napier with a short position of College Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manning Napier and College Retirement.
Diversification Opportunities for Manning Napier and College Retirement
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Manning and College is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Manning Napier Diversified and College Retirement Equities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on College Retirement and Manning Napier 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 Manning Napier Diversified are associated (or correlated) with College Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of College Retirement has no effect on the direction of Manning Napier i.e., Manning Napier and College Retirement go up and down completely randomly.
Pair Corralation between Manning Napier and College Retirement
Assuming the 90 days horizon Manning Napier is expected to generate 13.08 times less return on investment than College Retirement. But when comparing it to its historical volatility, Manning Napier Diversified is 5.11 times less risky than College Retirement. It trades about 0.03 of its potential returns per unit of risk. College Retirement Equities is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 28,660 in College Retirement Equities on October 17, 2024 and sell it today you would earn a total of 5,087 from holding College Retirement Equities or generate 17.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manning Napier Diversified vs. College Retirement Equities
Performance |
| Timeline |
| Manning Napier Diver |
| College Retirement |
Manning Napier and College Retirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manning Napier and College Retirement
The main advantage of trading using opposite Manning Napier and College Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manning Napier position performs unexpectedly, College Retirement 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 College Retirement will offset losses from the drop in College Retirement's long position.| Manning Napier vs. Bbh Intermediate Municipal | Manning Napier vs. Blrc Sgy Mnp | Manning Napier vs. Nuveen Strategic Municipal | Manning Napier vs. Aig Government Money |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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