Correlation Between Payden Global and Payden Equity
Can any of the company-specific risk be diversified away by investing in both Payden Global and Payden Equity 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 Payden Global and Payden Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Payden Global Low and Payden Equity Income, you can compare the effects of market volatilities on Payden Global and Payden Equity 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 Payden Global with a short position of Payden Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Payden Global and Payden Equity.
Diversification Opportunities for Payden Global and Payden Equity
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Payden and Payden is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Payden Global Low and Payden Equity Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Equity Income and Payden 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 Payden Global Low are associated (or correlated) with Payden Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Equity Income has no effect on the direction of Payden Global i.e., Payden Global and Payden Equity go up and down completely randomly.
Pair Corralation between Payden Global and Payden Equity
Assuming the 90 days horizon Payden Global is expected to generate 5.65 times less return on investment than Payden Equity. But when comparing it to its historical volatility, Payden Global Low is 7.44 times less risky than Payden Equity. It trades about 0.24 of its potential returns per unit of risk. Payden Equity Income is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,630 in Payden Equity Income on October 23, 2024 and sell it today you would earn a total of 38.00 from holding Payden Equity Income or generate 2.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Payden Global Low vs. Payden Equity Income
Performance |
| Timeline |
| Payden Global Low |
| Payden Equity Income |
Payden Global and Payden Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Payden Global and Payden Equity
The main advantage of trading using opposite Payden Global and Payden Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Payden Global position performs unexpectedly, Payden Equity 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 Payden Equity will offset losses from the drop in Payden Equity's long position.| Payden Global vs. Dws Government Money | Payden Global vs. Payden Government Fund | Payden Global vs. Intermediate Government Bond | Payden Global vs. Dunham Porategovernment Bond |
| Payden Equity vs. Payden Equity Income | Payden Equity vs. Select Fund R | Payden Equity vs. Select Fund C | Payden Equity vs. Sentinel Mon Stock |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |