Correlation Between Patria Investments and Arrowmark Financial
Can any of the company-specific risk be diversified away by investing in both Patria Investments and Arrowmark Financial 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 Patria Investments and Arrowmark Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Patria Investments and Arrowmark Financial Corp, you can compare the effects of market volatilities on Patria Investments and Arrowmark Financial 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 Patria Investments with a short position of Arrowmark Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patria Investments and Arrowmark Financial.
Diversification Opportunities for Patria Investments and Arrowmark Financial
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Patria and Arrowmark is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Patria Investments and Arrowmark Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrowmark Financial Corp and Patria Investments 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 Patria Investments are associated (or correlated) with Arrowmark Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrowmark Financial Corp has no effect on the direction of Patria Investments i.e., Patria Investments and Arrowmark Financial go up and down completely randomly.
Pair Corralation between Patria Investments and Arrowmark Financial
Considering the 90-day investment horizon Patria Investments is expected to under-perform the Arrowmark Financial. In addition to that, Patria Investments is 1.67 times more volatile than Arrowmark Financial Corp. It trades about -0.02 of its total potential returns per unit of risk. Arrowmark Financial Corp is currently generating about 0.13 per unit of volatility. If you would invest 1,754 in Arrowmark Financial Corp on September 3, 2024 and sell it today you would earn a total of 308.00 from holding Arrowmark Financial Corp or generate 17.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Patria Investments vs. Arrowmark Financial Corp
Performance |
| Timeline |
| Patria Investments |
| Arrowmark Financial Corp |
Patria Investments and Arrowmark Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patria Investments and Arrowmark Financial
The main advantage of trading using opposite Patria Investments and Arrowmark Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patria Investments position performs unexpectedly, Arrowmark Financial 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 Arrowmark Financial will offset losses from the drop in Arrowmark Financial's long position.| Patria Investments vs. Invesco Advantage MIT | Patria Investments vs. Invesco Municipal Trust | Patria Investments vs. Invesco California Value | Patria Investments vs. Brightsphere Investment Group |
| Arrowmark Financial vs. Brookfield Business Corp | Arrowmark Financial vs. Elysee Development Corp | Arrowmark Financial vs. DWS Municipal Income | Arrowmark Financial vs. Blackrock Munivest |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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