Correlation Between IndexIQ and FFHG
Can any of the company-specific risk be diversified away by investing in both IndexIQ and FFHG 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 IndexIQ and FFHG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IndexIQ and FFHG, you can compare the effects of market volatilities on IndexIQ and FFHG 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 IndexIQ with a short position of FFHG. Check out your portfolio center. Please also check ongoing floating volatility patterns of IndexIQ and FFHG.
Diversification Opportunities for IndexIQ and FFHG
Very good diversification
The 3 months correlation between IndexIQ and FFHG is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding IndexIQ and FFHG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FFHG and IndexIQ 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 IndexIQ are associated (or correlated) with FFHG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FFHG has no effect on the direction of IndexIQ i.e., IndexIQ and FFHG go up and down completely randomly.
Pair Corralation between IndexIQ and FFHG
Considering the 90-day investment horizon IndexIQ is expected to under-perform the FFHG. In addition to that, IndexIQ is 28.59 times more volatile than FFHG. It trades about -0.16 of its total potential returns per unit of risk. FFHG is currently generating about 0.06 per unit of volatility. If you would invest 3,185 in FFHG on August 31, 2024 and sell it today you would earn a total of 164.00 from holding FFHG or generate 5.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 23.53% |
| Values | Daily Returns |
IndexIQ vs. FFHG
Performance |
| Timeline |
| IndexIQ |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| FFHG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IndexIQ and FFHG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IndexIQ and FFHG
The main advantage of trading using opposite IndexIQ and FFHG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IndexIQ position performs unexpectedly, FFHG 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 FFHG will offset losses from the drop in FFHG's long position.| IndexIQ vs. First Trust Managed | IndexIQ vs. IQ Hedge Multi Strategy | IndexIQ vs. First Trust BuyWrite | IndexIQ vs. SPDR SSgA Global |
| FFHG vs. FT Vest Equity | FFHG vs. Zillow Group Class | FFHG vs. Northern Lights | FFHG vs. VanEck Vectors Moodys |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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