Correlation Between NewFunds Low and Absa Multi
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By analyzing existing cross correlation between NewFunds Low Volatility and Absa Multi Managed, you can compare the effects of market volatilities on NewFunds Low and Absa Multi 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 NewFunds Low with a short position of Absa Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of NewFunds Low and Absa Multi.
Diversification Opportunities for NewFunds Low and Absa Multi
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NewFunds and Absa is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding NewFunds Low Volatility and Absa Multi Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absa Multi Managed and NewFunds Low 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 NewFunds Low Volatility are associated (or correlated) with Absa Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absa Multi Managed has no effect on the direction of NewFunds Low i.e., NewFunds Low and Absa Multi go up and down completely randomly.
Pair Corralation between NewFunds Low and Absa Multi
Assuming the 90 days trading horizon NewFunds Low is expected to generate 1.14 times less return on investment than Absa Multi. In addition to that, NewFunds Low is 1.79 times more volatile than Absa Multi Managed. It trades about 0.12 of its total potential returns per unit of risk. Absa Multi Managed is currently generating about 0.24 per unit of volatility. If you would invest 249.00 in Absa Multi Managed on September 12, 2024 and sell it today you would earn a total of 13.00 from holding Absa Multi Managed or generate 5.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
NewFunds Low Volatility vs. Absa Multi Managed
Performance |
| Timeline |
| NewFunds Low Volatility |
| Absa Multi Managed |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
NewFunds Low and Absa Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NewFunds Low and Absa Multi
The main advantage of trading using opposite NewFunds Low and Absa Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NewFunds Low position performs unexpectedly, Absa Multi 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 Absa Multi will offset losses from the drop in Absa Multi's long position.| NewFunds Low vs. Centaur Bci Balanced | NewFunds Low vs. Europa Metals | NewFunds Low vs. British American Tobacco | NewFunds Low vs. Kap Industrial Holdings |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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