Correlation Between Transamerica Funds and Astor Long/short
Can any of the company-specific risk be diversified away by investing in both Transamerica Funds and Astor Long/short 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 Transamerica Funds and Astor Long/short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transamerica Funds and Astor Longshort Fund, you can compare the effects of market volatilities on Transamerica Funds and Astor Long/short 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 Transamerica Funds with a short position of Astor Long/short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transamerica Funds and Astor Long/short.
Diversification Opportunities for Transamerica Funds and Astor Long/short
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Transamerica and Astor is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Transamerica Funds and Astor Longshort Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Long/short and Transamerica Funds 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 Transamerica Funds are associated (or correlated) with Astor Long/short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Long/short has no effect on the direction of Transamerica Funds i.e., Transamerica Funds and Astor Long/short go up and down completely randomly.
Pair Corralation between Transamerica Funds and Astor Long/short
Assuming the 90 days horizon Transamerica Funds is expected to generate 58.71 times less return on investment than Astor Long/short. In addition to that, Transamerica Funds is 1.07 times more volatile than Astor Longshort Fund. It trades about 0.0 of its total potential returns per unit of risk. Astor Longshort Fund is currently generating about 0.12 per unit of volatility. If you would invest 1,093 in Astor Longshort Fund on August 27, 2024 and sell it today you would earn a total of 221.00 from holding Astor Longshort Fund or generate 20.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 61.76% |
| Values | Daily Returns |
Transamerica Funds vs. Astor Longshort Fund
Performance |
| Timeline |
| Transamerica Funds |
| Astor Long/short |
Transamerica Funds and Astor Long/short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transamerica Funds and Astor Long/short
The main advantage of trading using opposite Transamerica Funds and Astor Long/short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transamerica Funds position performs unexpectedly, Astor Long/short 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 Astor Long/short will offset losses from the drop in Astor Long/short's long position.| Transamerica Funds vs. Vanguard Total Stock | Transamerica Funds vs. Vanguard 500 Index | Transamerica Funds vs. Vanguard Total Stock | Transamerica Funds vs. Vanguard Total Stock |
| Astor Long/short vs. Transamerica Funds | Astor Long/short vs. Dreyfus Institutional Reserves | Astor Long/short vs. Pioneer Money Market | Astor Long/short vs. Franklin Government Money |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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