Correlation Between Maryland Tax and Altegris Futures
Can any of the company-specific risk be diversified away by investing in both Maryland Tax and Altegris Futures 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 Maryland Tax and Altegris Futures into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maryland Tax Free Bond and Altegris Futures Evolution, you can compare the effects of market volatilities on Maryland Tax and Altegris Futures 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 Maryland Tax with a short position of Altegris Futures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maryland Tax and Altegris Futures.
Diversification Opportunities for Maryland Tax and Altegris Futures
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maryland and Altegris is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Maryland Tax Free Bond and Altegris Futures Evolution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altegris Futures Evo and Maryland Tax 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 Maryland Tax Free Bond are associated (or correlated) with Altegris Futures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altegris Futures Evo has no effect on the direction of Maryland Tax i.e., Maryland Tax and Altegris Futures go up and down completely randomly.
Pair Corralation between Maryland Tax and Altegris Futures
Assuming the 90 days horizon Maryland Tax Free Bond is expected to generate 0.6 times more return on investment than Altegris Futures. However, Maryland Tax Free Bond is 1.66 times less risky than Altegris Futures. It trades about 0.02 of its potential returns per unit of risk. Altegris Futures Evolution is currently generating about -0.04 per unit of risk. If you would invest 1,002 in Maryland Tax Free Bond on October 23, 2024 and sell it today you would earn a total of 1.00 from holding Maryland Tax Free Bond or generate 0.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maryland Tax Free Bond vs. Altegris Futures Evolution
Performance |
| Timeline |
| Maryland Tax Free |
| Altegris Futures Evo |
Maryland Tax and Altegris Futures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maryland Tax and Altegris Futures
The main advantage of trading using opposite Maryland Tax and Altegris Futures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maryland Tax position performs unexpectedly, Altegris Futures 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 Altegris Futures will offset losses from the drop in Altegris Futures' long position.| Maryland Tax vs. Smead Value Fund | Maryland Tax vs. Calvert Large Cap | Maryland Tax vs. Qs Large Cap | Maryland Tax vs. Transamerica Large Cap |
| Altegris Futures vs. Absolute Convertible Arbitrage | Altegris Futures vs. Allianzgi Convertible Income | Altegris Futures vs. Virtus Convertible | Altegris Futures vs. Calamos Dynamic Convertible |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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