Correlation Between 1290 Funds and Federated Short-intermedia
Can any of the company-specific risk be diversified away by investing in both 1290 Funds and Federated Short-intermedia 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 1290 Funds and Federated Short-intermedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1290 Funds and Federated Short Intermediate Duration, you can compare the effects of market volatilities on 1290 Funds and Federated Short-intermedia 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 1290 Funds with a short position of Federated Short-intermedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1290 Funds and Federated Short-intermedia.
Diversification Opportunities for 1290 Funds and Federated Short-intermedia
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between 1290 and FEDERATED is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding 1290 Funds and Federated Short Intermediate D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short-intermedia and 1290 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 1290 Funds are associated (or correlated) with Federated Short-intermedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short-intermedia has no effect on the direction of 1290 Funds i.e., 1290 Funds and Federated Short-intermedia go up and down completely randomly.
Pair Corralation between 1290 Funds and Federated Short-intermedia
Assuming the 90 days horizon 1290 Funds is expected to generate 6.51 times more return on investment than Federated Short-intermedia. However, 1290 Funds is 6.51 times more volatile than Federated Short Intermediate Duration. It trades about 0.13 of its potential returns per unit of risk. Federated Short Intermediate Duration is currently generating about 0.15 per unit of risk. If you would invest 1,797 in 1290 Funds on August 29, 2024 and sell it today you would earn a total of 52.00 from holding 1290 Funds or generate 2.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
1290 Funds vs. Federated Short Intermediate D
Performance |
| Timeline |
| 1290 Funds |
| Federated Short-intermedia |
1290 Funds and Federated Short-intermedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1290 Funds and Federated Short-intermedia
The main advantage of trading using opposite 1290 Funds and Federated Short-intermedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1290 Funds position performs unexpectedly, Federated Short-intermedia 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 Federated Short-intermedia will offset losses from the drop in Federated Short-intermedia's long position.| 1290 Funds vs. Astor Longshort Fund | 1290 Funds vs. Federated Short Intermediate Duration | 1290 Funds vs. T Rowe Price | 1290 Funds vs. Bbh Intermediate Municipal |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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