Correlation Between ETRACS 2x and Martin Currie
Can any of the company-specific risk be diversified away by investing in both ETRACS 2x and Martin Currie 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 ETRACS 2x and Martin Currie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETRACS 2x Leveraged and Martin Currie Sustainable, you can compare the effects of market volatilities on ETRACS 2x and Martin Currie 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 ETRACS 2x with a short position of Martin Currie. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETRACS 2x and Martin Currie.
Diversification Opportunities for ETRACS 2x and Martin Currie
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ETRACS and Martin is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding ETRACS 2x Leveraged and Martin Currie Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Martin Currie Sustainable and ETRACS 2x 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 ETRACS 2x Leveraged are associated (or correlated) with Martin Currie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Martin Currie Sustainable has no effect on the direction of ETRACS 2x i.e., ETRACS 2x and Martin Currie go up and down completely randomly.
Pair Corralation between ETRACS 2x and Martin Currie
Given the investment horizon of 90 days ETRACS 2x Leveraged is expected to generate 1.76 times more return on investment than Martin Currie. However, ETRACS 2x is 1.76 times more volatile than Martin Currie Sustainable. It trades about 0.07 of its potential returns per unit of risk. Martin Currie Sustainable is currently generating about 0.01 per unit of risk. If you would invest 1,725 in ETRACS 2x Leveraged on September 3, 2024 and sell it today you would earn a total of 1,474 from holding ETRACS 2x Leveraged or generate 85.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ETRACS 2x Leveraged vs. Martin Currie Sustainable
Performance |
| Timeline |
| ETRACS 2x Leveraged |
| Martin Currie Sustainable |
ETRACS 2x and Martin Currie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETRACS 2x and Martin Currie
The main advantage of trading using opposite ETRACS 2x and Martin Currie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETRACS 2x position performs unexpectedly, Martin Currie 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 Martin Currie will offset losses from the drop in Martin Currie's long position.| ETRACS 2x vs. Freedom Day Dividend | ETRACS 2x vs. iShares MSCI China | ETRACS 2x vs. SmartETFs Dividend Builder | ETRACS 2x vs. Tidal ETF Trust |
| 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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