Correlation Between Federated Pennsylvania and Bear Profund
Can any of the company-specific risk be diversified away by investing in both Federated Pennsylvania and Bear Profund 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 Pennsylvania and Bear Profund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Pennsylvania Municipal and Bear Profund Bear, you can compare the effects of market volatilities on Federated Pennsylvania and Bear Profund 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 Pennsylvania with a short position of Bear Profund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Pennsylvania and Bear Profund.
Diversification Opportunities for Federated Pennsylvania and Bear Profund
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Federated and Bear is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Federated Pennsylvania Municip and Bear Profund Bear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bear Profund Bear and Federated Pennsylvania 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 Pennsylvania Municipal are associated (or correlated) with Bear Profund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bear Profund Bear has no effect on the direction of Federated Pennsylvania i.e., Federated Pennsylvania and Bear Profund go up and down completely randomly.
Pair Corralation between Federated Pennsylvania and Bear Profund
Assuming the 90 days horizon Federated Pennsylvania Municipal is expected to generate 0.28 times more return on investment than Bear Profund. However, Federated Pennsylvania Municipal is 3.53 times less risky than Bear Profund. It trades about 0.07 of its potential returns per unit of risk. Bear Profund Bear is currently generating about -0.07 per unit of risk. If you would invest 965.00 in Federated Pennsylvania Municipal on September 12, 2024 and sell it today you would earn a total of 51.00 from holding Federated Pennsylvania Municipal or generate 5.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Pennsylvania Municip vs. Bear Profund Bear
Performance |
| Timeline |
| Federated Pennsylvania |
| Bear Profund Bear |
Federated Pennsylvania and Bear Profund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Pennsylvania and Bear Profund
The main advantage of trading using opposite Federated Pennsylvania and Bear Profund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Pennsylvania position performs unexpectedly, Bear Profund 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 Bear Profund will offset losses from the drop in Bear Profund's long position.| Federated Pennsylvania vs. Balanced Fund Investor | Federated Pennsylvania vs. Multimedia Portfolio Multimedia | Federated Pennsylvania vs. T Rowe Price | Federated Pennsylvania vs. L Abbett Fundamental |
| Bear Profund vs. Qs Defensive Growth | Bear Profund vs. Praxis Growth Index | Bear Profund vs. Eip Growth And | Bear Profund vs. Artisan Small Cap |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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