Correlation Between Main Thematic and Invesco Global
Can any of the company-specific risk be diversified away by investing in both Main Thematic and Invesco Global 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 Main Thematic and Invesco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Main Thematic Innovation and Invesco Global Clean, you can compare the effects of market volatilities on Main Thematic and Invesco Global 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 Main Thematic with a short position of Invesco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Main Thematic and Invesco Global.
Diversification Opportunities for Main Thematic and Invesco Global
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Main and Invesco is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Main Thematic Innovation and Invesco Global Clean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Global Clean and Main Thematic 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 Main Thematic Innovation are associated (or correlated) with Invesco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Global Clean has no effect on the direction of Main Thematic i.e., Main Thematic and Invesco Global go up and down completely randomly.
Pair Corralation between Main Thematic and Invesco Global
Given the investment horizon of 90 days Main Thematic Innovation is expected to generate 0.99 times more return on investment than Invesco Global. However, Main Thematic Innovation is 1.01 times less risky than Invesco Global. It trades about 0.14 of its potential returns per unit of risk. Invesco Global Clean is currently generating about -0.08 per unit of risk. If you would invest 1,679 in Main Thematic Innovation on September 1, 2024 and sell it today you would earn a total of 509.00 from holding Main Thematic Innovation or generate 30.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Main Thematic Innovation vs. Invesco Global Clean
Performance |
| Timeline |
| Main Thematic Innovation |
| Invesco Global Clean |
Main Thematic and Invesco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Main Thematic and Invesco Global
The main advantage of trading using opposite Main Thematic and Invesco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Main Thematic position performs unexpectedly, Invesco Global 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 Invesco Global will offset losses from the drop in Invesco Global's long position.| Main Thematic vs. Main Sector Rotation | Main Thematic vs. Global X Thematic | Main Thematic vs. Franklin Exponential Data | Main Thematic vs. Goldman Sachs Innovate |
| Invesco Global vs. Quadratic Interest Rate | Invesco Global vs. Simplify Interest Rate | Invesco Global vs. iShares Small Cap | Invesco Global vs. Freedom 100 Emerging |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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