Correlation Between Ambrus Core and Hennessy Technology
Can any of the company-specific risk be diversified away by investing in both Ambrus Core and Hennessy Technology 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 Ambrus Core and Hennessy Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambrus Core Bond and Hennessy Technology Fund, you can compare the effects of market volatilities on Ambrus Core and Hennessy Technology 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 Ambrus Core with a short position of Hennessy Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambrus Core and Hennessy Technology.
Diversification Opportunities for Ambrus Core and Hennessy Technology
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ambrus and Hennessy is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ambrus Core Bond and Hennessy Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Technology and Ambrus Core 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 Ambrus Core Bond are associated (or correlated) with Hennessy Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Technology has no effect on the direction of Ambrus Core i.e., Ambrus Core and Hennessy Technology go up and down completely randomly.
Pair Corralation between Ambrus Core and Hennessy Technology
Assuming the 90 days horizon Ambrus Core is expected to generate 10.56 times less return on investment than Hennessy Technology. But when comparing it to its historical volatility, Ambrus Core Bond is 7.29 times less risky than Hennessy Technology. It trades about 0.16 of its potential returns per unit of risk. Hennessy Technology Fund is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 2,323 in Hennessy Technology Fund on September 2, 2024 and sell it today you would earn a total of 149.00 from holding Hennessy Technology Fund or generate 6.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambrus Core Bond vs. Hennessy Technology Fund
Performance |
| Timeline |
| Ambrus Core Bond |
| Hennessy Technology |
Ambrus Core and Hennessy Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambrus Core and Hennessy Technology
The main advantage of trading using opposite Ambrus Core and Hennessy Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambrus Core position performs unexpectedly, Hennessy Technology 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 Hennessy Technology will offset losses from the drop in Hennessy Technology's long position.| Ambrus Core vs. John Hancock Financial | Ambrus Core vs. Vanguard Financials Index | Ambrus Core vs. Transamerica Financial Life | Ambrus Core vs. Blackrock Financial Institutions |
| Hennessy Technology vs. Bbh Intermediate Municipal | Hennessy Technology vs. Touchstone Premium Yield | Hennessy Technology vs. Ambrus Core Bond | Hennessy Technology vs. Thrivent Income Fund |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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