Correlation Between Smallcap Fund and Federated High
Can any of the company-specific risk be diversified away by investing in both Smallcap Fund and Federated High 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 Smallcap Fund and Federated High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smallcap Fund Fka and Federated High Income, you can compare the effects of market volatilities on Smallcap Fund and Federated High 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 Smallcap Fund with a short position of Federated High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smallcap Fund and Federated High.
Diversification Opportunities for Smallcap Fund and Federated High
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Smallcap and Federated is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Smallcap Fund Fka and Federated High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated High Income and Smallcap Fund 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 Smallcap Fund Fka are associated (or correlated) with Federated High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated High Income has no effect on the direction of Smallcap Fund i.e., Smallcap Fund and Federated High go up and down completely randomly.
Pair Corralation between Smallcap Fund and Federated High
If you would invest 2,392 in Smallcap Fund Fka on November 3, 2024 and sell it today you would earn a total of 256.00 from holding Smallcap Fund Fka or generate 10.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.81% |
| Values | Daily Returns |
Smallcap Fund Fka vs. Federated High Income
Performance |
| Timeline |
| Smallcap Fund Fka |
| Federated High Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Smallcap Fund and Federated High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smallcap Fund and Federated High
The main advantage of trading using opposite Smallcap Fund and Federated High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smallcap Fund position performs unexpectedly, Federated High 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 Federated High will offset losses from the drop in Federated High's long position.| Smallcap Fund vs. Vanguard Small Cap Index | Smallcap Fund vs. Vanguard Small Cap Index | Smallcap Fund vs. Vanguard Small Cap Index | Smallcap Fund vs. Vanguard Small Cap Index |
| Federated High vs. Multisector Bond Sma | Federated High vs. Artisan High Income | Federated High vs. Barings High Yield | Federated High vs. Angel Oak Financial |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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