Correlation Between Emerging Markets and Astor Long/short
Can any of the company-specific risk be diversified away by investing in both Emerging Markets and Astor Long/short 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 Emerging Markets and Astor Long/short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Markets Bond and Astor Longshort Fund, you can compare the effects of market volatilities on Emerging Markets and Astor Long/short 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 Emerging Markets with a short position of Astor Long/short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Astor Long/short.
Diversification Opportunities for Emerging Markets and Astor Long/short
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Emerging and Astor is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Bond and Astor Longshort Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Long/short and Emerging Markets 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 Emerging Markets Bond are associated (or correlated) with Astor Long/short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Long/short has no effect on the direction of Emerging Markets i.e., Emerging Markets and Astor Long/short go up and down completely randomly.
Pair Corralation between Emerging Markets and Astor Long/short
Assuming the 90 days horizon Emerging Markets is expected to generate 2.28 times less return on investment than Astor Long/short. But when comparing it to its historical volatility, Emerging Markets Bond is 1.33 times less risky than Astor Long/short. It trades about 0.15 of its potential returns per unit of risk. Astor Longshort Fund is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,393 in Astor Longshort Fund on August 30, 2024 and sell it today you would earn a total of 34.00 from holding Astor Longshort Fund or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Markets Bond vs. Astor Longshort Fund
Performance |
| Timeline |
| Emerging Markets Bond |
| Astor Long/short |
Emerging Markets and Astor Long/short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Markets and Astor Long/short
The main advantage of trading using opposite Emerging Markets and Astor Long/short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Markets position performs unexpectedly, Astor Long/short 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 Astor Long/short will offset losses from the drop in Astor Long/short's long position.| Emerging Markets vs. Astor Longshort Fund | Emerging Markets vs. Barings Active Short | Emerging Markets vs. Vanguard Short Term Federal | Emerging Markets vs. Aqr Long Short Equity |
| Astor Long/short vs. Ambrus Core Bond | Astor Long/short vs. Ms Global Fixed | Astor Long/short vs. T Rowe Price | Astor Long/short vs. Multisector Bond Sma |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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