Correlation Between Sparinvest USA and LED IBond
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By analyzing existing cross correlation between Sparinvest USA Small and LED iBond International, you can compare the effects of market volatilities on Sparinvest USA and LED IBond 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 Sparinvest USA with a short position of LED IBond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sparinvest USA and LED IBond.
Diversification Opportunities for Sparinvest USA and LED IBond
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sparinvest and LED is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Sparinvest USA Small and LED iBond International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LED iBond International and Sparinvest USA 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 Sparinvest USA Small are associated (or correlated) with LED IBond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LED iBond International has no effect on the direction of Sparinvest USA i.e., Sparinvest USA and LED IBond go up and down completely randomly.
Pair Corralation between Sparinvest USA and LED IBond
Assuming the 90 days trading horizon Sparinvest USA is expected to generate 14.59 times less return on investment than LED IBond. But when comparing it to its historical volatility, Sparinvest USA Small is 16.86 times less risky than LED IBond. It trades about 0.25 of its potential returns per unit of risk. LED iBond International is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 17.00 in LED iBond International on August 29, 2024 and sell it today you would earn a total of 16.00 from holding LED iBond International or generate 94.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sparinvest USA Small vs. LED iBond International
Performance |
| Timeline |
| Sparinvest USA Small |
| LED iBond International |
Sparinvest USA and LED IBond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sparinvest USA and LED IBond
The main advantage of trading using opposite Sparinvest USA and LED IBond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sparinvest USA position performs unexpectedly, LED IBond 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 LED IBond will offset losses from the drop in LED IBond's long position.| Sparinvest USA vs. Sparinvest Europa Growth | Sparinvest USA vs. Sparinvest INDEX Europa | Sparinvest USA vs. Sparinvest INDEX Hj | Sparinvest USA vs. Sparinvest SICAV Procedo |
| LED IBond vs. Alm Brand | LED IBond vs. Sparinvest INDEX Globale | LED IBond vs. Bavarian Nordic | LED IBond vs. Investeringsselskabet Luxor AS |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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