Correlation Between RiverNorth Managed and IHIT
Can any of the company-specific risk be diversified away by investing in both RiverNorth Managed and IHIT 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 RiverNorth Managed and IHIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RiverNorth Managed Duration and IHIT, you can compare the effects of market volatilities on RiverNorth Managed and IHIT 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 RiverNorth Managed with a short position of IHIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of RiverNorth Managed and IHIT.
Diversification Opportunities for RiverNorth Managed and IHIT
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RiverNorth and IHIT is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding RiverNorth Managed Duration and IHIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHIT and RiverNorth Managed 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 RiverNorth Managed Duration are associated (or correlated) with IHIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHIT has no effect on the direction of RiverNorth Managed i.e., RiverNorth Managed and IHIT go up and down completely randomly.
Pair Corralation between RiverNorth Managed and IHIT
If you would invest 1,525 in RiverNorth Managed Duration on September 1, 2024 and sell it today you would earn a total of 53.00 from holding RiverNorth Managed Duration or generate 3.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
RiverNorth Managed Duration vs. IHIT
Performance |
| Timeline |
| RiverNorth Managed |
| IHIT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
RiverNorth Managed and IHIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RiverNorth Managed and IHIT
The main advantage of trading using opposite RiverNorth Managed and IHIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RiverNorth Managed position performs unexpectedly, IHIT 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 IHIT will offset losses from the drop in IHIT's long position.The idea behind RiverNorth Managed Duration and IHIT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| IHIT vs. MFS Investment Grade | IHIT vs. Eaton Vance National | IHIT vs. Invesco High Income | IHIT vs. Nuveen California Select |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |