Correlation Between Columbia Minnesota and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Columbia Minnesota 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 Columbia Minnesota and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Minnesota Tax Exempt and Credit Suisse Managed, you can compare the effects of market volatilities on Columbia Minnesota 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 Columbia Minnesota with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Minnesota and Credit Suisse.
Diversification Opportunities for Columbia Minnesota and Credit Suisse
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Columbia and Credit is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Minnesota Tax Exempt and Credit Suisse Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Managed and Columbia Minnesota 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 Columbia Minnesota Tax Exempt 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 Managed has no effect on the direction of Columbia Minnesota i.e., Columbia Minnesota and Credit Suisse go up and down completely randomly.
Pair Corralation between Columbia Minnesota and Credit Suisse
Assuming the 90 days horizon Columbia Minnesota Tax Exempt is expected to under-perform the Credit Suisse. But the mutual fund apears to be less risky and, when comparing its historical volatility, Columbia Minnesota Tax Exempt is 1.92 times less risky than Credit Suisse. The mutual fund trades about -0.04 of its potential returns per unit of risk. The Credit Suisse Managed is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 849.00 in Credit Suisse Managed on October 22, 2024 and sell it today you would earn a total of 22.00 from holding Credit Suisse Managed or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Minnesota Tax Exempt vs. Credit Suisse Managed
Performance |
| Timeline |
| Columbia Minnesota Tax |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Credit Suisse Managed |
Columbia Minnesota and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Minnesota and Credit Suisse
The main advantage of trading using opposite Columbia Minnesota and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Minnesota 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.| Columbia Minnesota vs. Cmg Ultra Short | Columbia Minnesota vs. Virtus Multi Sector Short | Columbia Minnesota vs. Prudential Short Duration | Columbia Minnesota vs. Jhancock Short 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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