Correlation Between Guggenheim Managed and Long Term
Can any of the company-specific risk be diversified away by investing in both Guggenheim Managed and Long Term 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 Guggenheim Managed and Long Term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guggenheim Managed Futures and Long Term Government Fund, you can compare the effects of market volatilities on Guggenheim Managed and Long Term 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 Guggenheim Managed with a short position of Long Term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Managed and Long Term.
Diversification Opportunities for Guggenheim Managed and Long Term
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Guggenheim and Long is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Managed Futures and Long Term Government Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Term Government and Guggenheim 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 Guggenheim Managed Futures are associated (or correlated) with Long Term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Term Government has no effect on the direction of Guggenheim Managed i.e., Guggenheim Managed and Long Term go up and down completely randomly.
Pair Corralation between Guggenheim Managed and Long Term
Assuming the 90 days horizon Guggenheim Managed is expected to generate 26.21 times less return on investment than Long Term. But when comparing it to its historical volatility, Guggenheim Managed Futures is 17.88 times less risky than Long Term. It trades about 0.02 of its potential returns per unit of risk. Long Term Government Fund is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,485 in Long Term Government Fund on October 27, 2024 and sell it today you would lose (124.00) from holding Long Term Government Fund or give up 8.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guggenheim Managed Futures vs. Long Term Government Fund
Performance |
| Timeline |
| Guggenheim Managed |
| Long Term Government |
Guggenheim Managed and Long Term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guggenheim Managed and Long Term
The main advantage of trading using opposite Guggenheim Managed and Long Term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guggenheim Managed position performs unexpectedly, Long Term 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 Long Term will offset losses from the drop in Long Term's long position.| Guggenheim Managed vs. Aqr Sustainable Long Short | Guggenheim Managed vs. Transamerica Short Term Bond | Guggenheim Managed vs. Vela Short Duration | Guggenheim Managed vs. Transam Short Term Bond |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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