Correlation Between Columbia Small and Amg Managers
Can any of the company-specific risk be diversified away by investing in both Columbia Small and Amg Managers 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 Columbia Small and Amg Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Small Cap and Amg Managers Centersquare, you can compare the effects of market volatilities on Columbia Small and Amg Managers 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 Columbia Small with a short position of Amg Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Small and Amg Managers.
Diversification Opportunities for Columbia Small and Amg Managers
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Columbia and Amg is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Small Cap and Amg Managers Centersquare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Managers Centersquare and Columbia Small 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 Columbia Small Cap are associated (or correlated) with Amg Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Managers Centersquare has no effect on the direction of Columbia Small i.e., Columbia Small and Amg Managers go up and down completely randomly.
Pair Corralation between Columbia Small and Amg Managers
Assuming the 90 days horizon Columbia Small Cap is expected to under-perform the Amg Managers. In addition to that, Columbia Small is 2.15 times more volatile than Amg Managers Centersquare. It trades about -0.04 of its total potential returns per unit of risk. Amg Managers Centersquare is currently generating about -0.02 per unit of volatility. If you would invest 1,209 in Amg Managers Centersquare on September 13, 2024 and sell it today you would lose (12.00) from holding Amg Managers Centersquare or give up 0.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Small Cap vs. Amg Managers Centersquare
Performance |
| Timeline |
| Columbia Small Cap |
| Amg Managers Centersquare |
Columbia Small and Amg Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Small and Amg Managers
The main advantage of trading using opposite Columbia Small and Amg Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Small position performs unexpectedly, Amg Managers 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 Amg Managers will offset losses from the drop in Amg Managers' long position.| Columbia Small vs. Columbia Porate Income | Columbia Small vs. Columbia Ultra Short | Columbia Small vs. Columbia Treasury Index | Columbia Small vs. Multi Manager Directional Alternative |
| Amg Managers vs. Realty Income | Amg Managers vs. Dynex Capital | Amg Managers vs. First Industrial Realty | Amg Managers vs. Healthcare Realty Trust |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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