Correlation Between Federated Ohio and Floating Rate
Can any of the company-specific risk be diversified away by investing in both Federated Ohio and Floating Rate 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 Federated Ohio and Floating Rate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Ohio Municipal and Floating Rate Fund, you can compare the effects of market volatilities on Federated Ohio and Floating Rate 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 Federated Ohio with a short position of Floating Rate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Ohio and Floating Rate.
Diversification Opportunities for Federated Ohio and Floating Rate
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Federated and Floating is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Federated Ohio Municipal and Floating Rate Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Floating Rate and Federated Ohio 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 Federated Ohio Municipal are associated (or correlated) with Floating Rate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Floating Rate has no effect on the direction of Federated Ohio i.e., Federated Ohio and Floating Rate go up and down completely randomly.
Pair Corralation between Federated Ohio and Floating Rate
Assuming the 90 days horizon Federated Ohio is expected to generate 1.2 times less return on investment than Floating Rate. In addition to that, Federated Ohio is 1.3 times more volatile than Floating Rate Fund. It trades about 0.11 of its total potential returns per unit of risk. Floating Rate Fund is currently generating about 0.17 per unit of volatility. If you would invest 791.00 in Floating Rate Fund on September 3, 2024 and sell it today you would earn a total of 28.00 from holding Floating Rate Fund or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Ohio Municipal vs. Floating Rate Fund
Performance |
| Timeline |
| Federated Ohio Municipal |
| Floating Rate |
Federated Ohio and Floating Rate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Ohio and Floating Rate
The main advantage of trading using opposite Federated Ohio and Floating Rate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Ohio position performs unexpectedly, Floating Rate 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 Floating Rate will offset losses from the drop in Floating Rate's long position.| Federated Ohio vs. Gmo Resources | Federated Ohio vs. Fidelity Advisor Energy | Federated Ohio vs. Calvert Global Energy | Federated Ohio vs. Energy Basic Materials |
| Floating Rate vs. Commodities Strategy Fund | Floating Rate vs. Balanced Fund Investor | Floating Rate vs. Auer Growth Fund | Floating Rate vs. Vanguard Windsor Fund |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |