Correlation Between Pioneer Floating and Farmers
Can any of the company-specific risk be diversified away by investing in both Pioneer Floating and Farmers 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 Pioneer Floating and Farmers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pioneer Floating Rate and Farmers And Merchants, you can compare the effects of market volatilities on Pioneer Floating and Farmers 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 Pioneer Floating with a short position of Farmers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pioneer Floating and Farmers.
Diversification Opportunities for Pioneer Floating and Farmers
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pioneer and Farmers is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Pioneer Floating Rate and Farmers And Merchants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farmers And Merchants and Pioneer Floating 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 Pioneer Floating Rate are associated (or correlated) with Farmers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farmers And Merchants has no effect on the direction of Pioneer Floating i.e., Pioneer Floating and Farmers go up and down completely randomly.
Pair Corralation between Pioneer Floating and Farmers
Considering the 90-day investment horizon Pioneer Floating is expected to generate 3.92 times less return on investment than Farmers. But when comparing it to its historical volatility, Pioneer Floating Rate is 1.93 times less risky than Farmers. It trades about 0.12 of its potential returns per unit of risk. Farmers And Merchants is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 545,000 in Farmers And Merchants on August 28, 2024 and sell it today you would earn a total of 20,000 from holding Farmers And Merchants or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pioneer Floating Rate vs. Farmers And Merchants
Performance |
| Timeline |
| Pioneer Floating Rate |
| Farmers And Merchants |
Pioneer Floating and Farmers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pioneer Floating and Farmers
The main advantage of trading using opposite Pioneer Floating and Farmers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pioneer Floating position performs unexpectedly, Farmers 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 Farmers will offset losses from the drop in Farmers' long position.| Pioneer Floating vs. Blackrock Floating Rate | Pioneer Floating vs. Eaton Vance Senior | Pioneer Floating vs. Eaton Vance Senior | Pioneer Floating vs. Blackrock Debt Strategies |
| Farmers vs. First National Bank | Farmers vs. Farmers Merchants Bancorp | Farmers vs. Exchange Bank | Farmers vs. First National of |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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