Correlation Between Performance Trust and Guggenheim Floating
Can any of the company-specific risk be diversified away by investing in both Performance Trust and Guggenheim Floating 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 Performance Trust and Guggenheim Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Trust Municipal and Guggenheim Floating Rate, you can compare the effects of market volatilities on Performance Trust and Guggenheim Floating 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 Performance Trust with a short position of Guggenheim Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Trust and Guggenheim Floating.
Diversification Opportunities for Performance Trust and Guggenheim Floating
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Performance and Guggenheim is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Performance Trust Municipal and Guggenheim Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Floating Rate and Performance Trust 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 Performance Trust Municipal are associated (or correlated) with Guggenheim Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Floating Rate has no effect on the direction of Performance Trust i.e., Performance Trust and Guggenheim Floating go up and down completely randomly.
Pair Corralation between Performance Trust and Guggenheim Floating
Assuming the 90 days horizon Performance Trust Municipal is expected to generate 1.8 times more return on investment than Guggenheim Floating. However, Performance Trust is 1.8 times more volatile than Guggenheim Floating Rate. It trades about 0.12 of its potential returns per unit of risk. Guggenheim Floating Rate is currently generating about 0.13 per unit of risk. If you would invest 2,229 in Performance Trust Municipal on September 1, 2024 and sell it today you would earn a total of 95.00 from holding Performance Trust Municipal or generate 4.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Performance Trust Municipal vs. Guggenheim Floating Rate
Performance |
| Timeline |
| Performance Trust |
| Guggenheim Floating Rate |
Performance Trust and Guggenheim Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Trust and Guggenheim Floating
The main advantage of trading using opposite Performance Trust and Guggenheim Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Trust position performs unexpectedly, Guggenheim Floating 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 Guggenheim Floating will offset losses from the drop in Guggenheim Floating's long position.| Performance Trust vs. Performance Trust Municipal | Performance Trust vs. Performance Trust Strategic | Performance Trust vs. Guggenheim Investment Grade | Performance Trust vs. Nuveen High Yield |
| Guggenheim Floating vs. The Hartford International | Guggenheim Floating vs. Baird E Plus | Guggenheim Floating vs. Guggenheim Floating Rate | Guggenheim Floating vs. Guggenheim Limited Duration |
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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