Correlation Between Columbia Seligman and Columbia Emerging
Can any of the company-specific risk be diversified away by investing in both Columbia Seligman and Columbia 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 Columbia Seligman and Columbia Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Seligman Global and Columbia Emerging Markets, you can compare the effects of market volatilities on Columbia Seligman and Columbia 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 Columbia Seligman with a short position of Columbia Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Seligman and Columbia Emerging.
Diversification Opportunities for Columbia Seligman and Columbia Emerging
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Columbia and Columbia is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Seligman Global and Columbia Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Emerging Markets and Columbia Seligman 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 Seligman Global are associated (or correlated) with Columbia Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Emerging Markets has no effect on the direction of Columbia Seligman i.e., Columbia Seligman and Columbia Emerging go up and down completely randomly.
Pair Corralation between Columbia Seligman and Columbia Emerging
Assuming the 90 days horizon Columbia Seligman Global is expected to generate 1.41 times more return on investment than Columbia Emerging. However, Columbia Seligman is 1.41 times more volatile than Columbia Emerging Markets. It trades about 0.13 of its potential returns per unit of risk. Columbia Emerging Markets is currently generating about 0.05 per unit of risk. If you would invest 7,512 in Columbia Seligman Global on October 26, 2024 and sell it today you would earn a total of 221.00 from holding Columbia Seligman Global or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Seligman Global vs. Columbia Emerging Markets
Performance |
| Timeline |
| Columbia Seligman Global |
| Columbia Emerging Markets |
Columbia Seligman and Columbia Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Seligman and Columbia Emerging
The main advantage of trading using opposite Columbia Seligman and Columbia Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Seligman position performs unexpectedly, Columbia 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 Columbia Emerging will offset losses from the drop in Columbia Emerging's long position.| Columbia Seligman vs. Fzdaqx | Columbia Seligman vs. Rational Dividend Capture | Columbia Seligman vs. Fzsvmx | Columbia Seligman vs. Fabwx |
| Columbia Emerging vs. Columbia Large Cap | Columbia Emerging vs. Columbia Trarian Core | Columbia Emerging vs. Columbia Dividend Opportunity | Columbia Emerging vs. Columbia Seligman Global |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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