Correlation Between Commodities Strategy and Investec Emerging
Can any of the company-specific risk be diversified away by investing in both Commodities Strategy and Investec Emerging 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 Commodities Strategy and Investec Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commodities Strategy Fund and Investec Emerging Markets, you can compare the effects of market volatilities on Commodities Strategy and Investec Emerging 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 Commodities Strategy with a short position of Investec Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commodities Strategy and Investec Emerging.
Diversification Opportunities for Commodities Strategy and Investec Emerging
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Commodities and Investec is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Commodities Strategy Fund and Investec Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investec Emerging Markets and Commodities Strategy 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 Commodities Strategy Fund are associated (or correlated) with Investec Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investec Emerging Markets has no effect on the direction of Commodities Strategy i.e., Commodities Strategy and Investec Emerging go up and down completely randomly.
Pair Corralation between Commodities Strategy and Investec Emerging
Assuming the 90 days horizon Commodities Strategy is expected to generate 1.71 times less return on investment than Investec Emerging. In addition to that, Commodities Strategy is 1.01 times more volatile than Investec Emerging Markets. It trades about 0.05 of its total potential returns per unit of risk. Investec Emerging Markets is currently generating about 0.08 per unit of volatility. If you would invest 908.00 in Investec Emerging Markets on November 9, 2024 and sell it today you would earn a total of 189.00 from holding Investec Emerging Markets or generate 20.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Commodities Strategy Fund vs. Investec Emerging Markets
Performance |
| Timeline |
| Commodities Strategy |
| Investec Emerging Markets |
Commodities Strategy and Investec Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commodities Strategy and Investec Emerging
The main advantage of trading using opposite Commodities Strategy and Investec Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commodities Strategy position performs unexpectedly, Investec Emerging 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 Investec Emerging will offset losses from the drop in Investec Emerging's long position.| Commodities Strategy vs. Basic Materials Fund | Commodities Strategy vs. Energy Services Fund | Commodities Strategy vs. Energy Fund Investor | Commodities Strategy vs. Real Estate Fund |
| Investec Emerging vs. Rational Special Situations | Investec Emerging vs. Ab Global Bond | Investec Emerging vs. Bbh Intermediate Municipal | Investec Emerging vs. Ab Bond Inflation |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |