Correlation Between Amundi Treasury and Vanguard USD
Can any of the company-specific risk be diversified away by investing in both Amundi Treasury and Vanguard USD 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 Amundi Treasury and Vanguard USD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi Treasury Bond and Vanguard USD Corporate, you can compare the effects of market volatilities on Amundi Treasury and Vanguard USD 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 Amundi Treasury with a short position of Vanguard USD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Treasury and Vanguard USD.
Diversification Opportunities for Amundi Treasury and Vanguard USD
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amundi and Vanguard is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Treasury Bond and Vanguard USD Corporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard USD Corporate and Amundi Treasury 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 Amundi Treasury Bond are associated (or correlated) with Vanguard USD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard USD Corporate has no effect on the direction of Amundi Treasury i.e., Amundi Treasury and Vanguard USD go up and down completely randomly.
Pair Corralation between Amundi Treasury and Vanguard USD
Assuming the 90 days trading horizon Amundi Treasury Bond is expected to generate 2.43 times more return on investment than Vanguard USD. However, Amundi Treasury is 2.43 times more volatile than Vanguard USD Corporate. It trades about 0.09 of its potential returns per unit of risk. Vanguard USD Corporate is currently generating about 0.17 per unit of risk. If you would invest 713.00 in Amundi Treasury Bond on September 1, 2024 and sell it today you would earn a total of 11.00 from holding Amundi Treasury Bond or generate 1.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi Treasury Bond vs. Vanguard USD Corporate
Performance |
| Timeline |
| Amundi Treasury Bond |
| Vanguard USD Corporate |
Amundi Treasury and Vanguard USD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Treasury and Vanguard USD
The main advantage of trading using opposite Amundi Treasury and Vanguard USD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Treasury position performs unexpectedly, Vanguard USD 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 Vanguard USD will offset losses from the drop in Vanguard USD's long position.| Amundi Treasury vs. WisdomTree Natural Gas | Amundi Treasury vs. WisdomTree Natural Gas | Amundi Treasury vs. Leverage Shares 2x | Amundi Treasury vs. WisdomTree Silver 3x |
| Vanguard USD vs. Vanguard USD Corporate | Vanguard USD vs. Vanguard Global Aggregate | Vanguard USD vs. Vanguard FTSE All World | Vanguard USD vs. Vanguard SP 500 |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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