Correlation Between Great-west and Touchstone Premium
Can any of the company-specific risk be diversified away by investing in both Great-west and Touchstone Premium 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 Great-west and Touchstone Premium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great West Sp Small and Touchstone Premium Yield, you can compare the effects of market volatilities on Great-west and Touchstone Premium 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 Great-west with a short position of Touchstone Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great-west and Touchstone Premium.
Diversification Opportunities for Great-west and Touchstone Premium
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Great-west and Touchstone is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Great West Sp Small and Touchstone Premium Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Premium Yield and Great-west 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 Great West Sp Small are associated (or correlated) with Touchstone Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Premium Yield has no effect on the direction of Great-west i.e., Great-west and Touchstone Premium go up and down completely randomly.
Pair Corralation between Great-west and Touchstone Premium
Assuming the 90 days horizon Great West Sp Small is expected to generate 1.32 times more return on investment than Touchstone Premium. However, Great-west is 1.32 times more volatile than Touchstone Premium Yield. It trades about 0.09 of its potential returns per unit of risk. Touchstone Premium Yield is currently generating about 0.05 per unit of risk. If you would invest 641.00 in Great West Sp Small on September 3, 2024 and sell it today you would earn a total of 111.00 from holding Great West Sp Small or generate 17.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great West Sp Small vs. Touchstone Premium Yield
Performance |
| Timeline |
| Great West Sp |
| Touchstone Premium Yield |
Great-west and Touchstone Premium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great-west and Touchstone Premium
The main advantage of trading using opposite Great-west and Touchstone Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great-west position performs unexpectedly, Touchstone Premium 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 Touchstone Premium will offset losses from the drop in Touchstone Premium's long position.| Great-west vs. Calamos Dynamic Convertible | Great-west vs. Touchstone Premium Yield | Great-west vs. Dreyfusstandish Global Fixed | Great-west vs. Limited Term Tax |
| Touchstone Premium vs. Dodge Cox Emerging | Touchstone Premium vs. Jpmorgan Emerging Markets | Touchstone Premium vs. Templeton Emerging Markets | Touchstone Premium vs. Legg Mason Partners |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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