Correlation Between Invesco Global and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Invesco Global and Credit Suisse 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 Invesco Global and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Global Listed and Credit Suisse X Links, you can compare the effects of market volatilities on Invesco Global and Credit Suisse 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 Invesco Global with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Global and Credit Suisse.
Diversification Opportunities for Invesco Global and Credit Suisse
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Invesco and Credit is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Global Listed and Credit Suisse X Links in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse X and Invesco Global 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 Invesco Global Listed are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse X has no effect on the direction of Invesco Global i.e., Invesco Global and Credit Suisse go up and down completely randomly.
Pair Corralation between Invesco Global and Credit Suisse
Considering the 90-day investment horizon Invesco Global Listed is expected to generate 1.43 times more return on investment than Credit Suisse. However, Invesco Global is 1.43 times more volatile than Credit Suisse X Links. It trades about 0.12 of its potential returns per unit of risk. Credit Suisse X Links is currently generating about 0.1 per unit of risk. If you would invest 6,722 in Invesco Global Listed on August 26, 2024 and sell it today you would earn a total of 371.00 from holding Invesco Global Listed or generate 5.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Global Listed vs. Credit Suisse X Links
Performance |
| Timeline |
| Invesco Global Listed |
| Credit Suisse X |
Invesco Global and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Global and Credit Suisse
The main advantage of trading using opposite Invesco Global and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Global position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.| Invesco Global vs. Main Sector Rotation | Invesco Global vs. Franklin Exponential Data | Invesco Global vs. Goldman Sachs Innovate |
| Credit Suisse vs. Aquagold International | Credit Suisse vs. Morningstar Unconstrained Allocation | Credit Suisse vs. High Yield Municipal Fund | Credit Suisse vs. Thrivent High Yield |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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