Correlation Between First Trust and Robo Global
Can any of the company-specific risk be diversified away by investing in both First Trust and Robo Global 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 First Trust and Robo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Nasdaq and Robo Global Artificial, you can compare the effects of market volatilities on First Trust and Robo Global 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 First Trust with a short position of Robo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Robo Global.
Diversification Opportunities for First Trust and Robo Global
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between First and Robo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Nasdaq and Robo Global Artificial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robo Global Artificial and First 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 First Trust Nasdaq are associated (or correlated) with Robo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robo Global Artificial has no effect on the direction of First Trust i.e., First Trust and Robo Global go up and down completely randomly.
Pair Corralation between First Trust and Robo Global
Given the investment horizon of 90 days First Trust is expected to generate 4.79 times less return on investment than Robo Global. But when comparing it to its historical volatility, First Trust Nasdaq is 1.03 times less risky than Robo Global. It trades about 0.01 of its potential returns per unit of risk. Robo Global Artificial is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 4,930 in Robo Global Artificial on October 22, 2024 and sell it today you would earn a total of 151.00 from holding Robo Global Artificial or generate 3.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trust Nasdaq vs. Robo Global Artificial
Performance |
| Timeline |
| First Trust Nasdaq |
| Robo Global Artificial |
First Trust and Robo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Robo Global
The main advantage of trading using opposite First Trust and Robo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Robo Global 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 Robo Global will offset losses from the drop in Robo Global's long position.| First Trust vs. Robo Global Robotics | First Trust vs. Robo Global Artificial | First Trust vs. Global X Robotics | First Trust vs. Direxion Daily Robotics |
| Robo Global vs. First Trust Nasdaq | Robo Global vs. Robo Global Healthcare | Robo Global vs. WisdomTree Trust | Robo Global vs. TrueShares Technology AI |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |