Correlation Between Georgia Tax-free and Fbjygx
Can any of the company-specific risk be diversified away by investing in both Georgia Tax-free and Fbjygx 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 Georgia Tax-free and Fbjygx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Georgia Tax Free Bond and Fbjygx, you can compare the effects of market volatilities on Georgia Tax-free and Fbjygx 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 Georgia Tax-free with a short position of Fbjygx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Georgia Tax-free and Fbjygx.
Diversification Opportunities for Georgia Tax-free and Fbjygx
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Georgia and Fbjygx is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Georgia Tax Free Bond and Fbjygx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fbjygx and Georgia Tax-free 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 Georgia Tax Free Bond are associated (or correlated) with Fbjygx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fbjygx has no effect on the direction of Georgia Tax-free i.e., Georgia Tax-free and Fbjygx go up and down completely randomly.
Pair Corralation between Georgia Tax-free and Fbjygx
Assuming the 90 days horizon Georgia Tax Free Bond is expected to under-perform the Fbjygx. But the mutual fund apears to be less risky and, when comparing its historical volatility, Georgia Tax Free Bond is 2.79 times less risky than Fbjygx. The mutual fund trades about -0.07 of its potential returns per unit of risk. The Fbjygx is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 913.00 in Fbjygx on November 3, 2024 and sell it today you would earn a total of 45.00 from holding Fbjygx or generate 4.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Georgia Tax Free Bond vs. Fbjygx
Performance |
| Timeline |
| Georgia Tax Free |
| Fbjygx |
Georgia Tax-free and Fbjygx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Georgia Tax-free and Fbjygx
The main advantage of trading using opposite Georgia Tax-free and Fbjygx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Georgia Tax-free position performs unexpectedly, Fbjygx 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 Fbjygx will offset losses from the drop in Fbjygx's long position.| Georgia Tax-free vs. Needham Aggressive Growth | Georgia Tax-free vs. Us High Relative | Georgia Tax-free vs. The Hartford High | Georgia Tax-free vs. Goldman Sachs High |
| Fbjygx vs. Vanguard Total Stock | Fbjygx vs. Vanguard 500 Index | Fbjygx vs. Vanguard Total Stock | Fbjygx vs. Vanguard Total Stock |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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