Correlation Between US Treasury and Rayliant Quantamental
Can any of the company-specific risk be diversified away by investing in both US Treasury and Rayliant Quantamental 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 US Treasury and Rayliant Quantamental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Treasury 12 and Rayliant Quantamental China, you can compare the effects of market volatilities on US Treasury and Rayliant Quantamental 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 US Treasury with a short position of Rayliant Quantamental. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Treasury and Rayliant Quantamental.
Diversification Opportunities for US Treasury and Rayliant Quantamental
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OBIL and Rayliant is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding US Treasury 12 and Rayliant Quantamental China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rayliant Quantamental and US Treasury 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 US Treasury 12 are associated (or correlated) with Rayliant Quantamental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rayliant Quantamental has no effect on the direction of US Treasury i.e., US Treasury and Rayliant Quantamental go up and down completely randomly.
Pair Corralation between US Treasury and Rayliant Quantamental
Given the investment horizon of 90 days US Treasury 12 is expected to generate 0.04 times more return on investment than Rayliant Quantamental. However, US Treasury 12 is 26.35 times less risky than Rayliant Quantamental. It trades about 0.31 of its potential returns per unit of risk. Rayliant Quantamental China is currently generating about -0.01 per unit of risk. If you would invest 4,556 in US Treasury 12 on November 9, 2024 and sell it today you would earn a total of 446.00 from holding US Treasury 12 or generate 9.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US Treasury 12 vs. Rayliant Quantamental China
Performance |
| Timeline |
| US Treasury 12 |
| Rayliant Quantamental |
US Treasury and Rayliant Quantamental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Treasury and Rayliant Quantamental
The main advantage of trading using opposite US Treasury and Rayliant Quantamental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Treasury position performs unexpectedly, Rayliant Quantamental 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 Rayliant Quantamental will offset losses from the drop in Rayliant Quantamental's long position.| US Treasury vs. Rbb Fund | US Treasury vs. Rbb Fund | US Treasury vs. Rbb Fund | US Treasury vs. US Treasury 6 |
| Rayliant Quantamental vs. iShares MSCI China | Rayliant Quantamental vs. Franklin FTSE China | Rayliant Quantamental vs. Simplify Exchange Traded |
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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