Correlation Between Amundi Treasury and Vanguard FTSE
Can any of the company-specific risk be diversified away by investing in both Amundi Treasury and Vanguard FTSE 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 FTSE 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 FTSE Developed, you can compare the effects of market volatilities on Amundi Treasury and Vanguard FTSE 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 FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Treasury and Vanguard FTSE.
Diversification Opportunities for Amundi Treasury and Vanguard FTSE
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amundi and Vanguard is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Treasury Bond and Vanguard FTSE Developed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard FTSE Developed 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 FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard FTSE Developed has no effect on the direction of Amundi Treasury i.e., Amundi Treasury and Vanguard FTSE go up and down completely randomly.
Pair Corralation between Amundi Treasury and Vanguard FTSE
Assuming the 90 days trading horizon Amundi Treasury is expected to generate 108.2 times less return on investment than Vanguard FTSE. In addition to that, Amundi Treasury is 1.0 times more volatile than Vanguard FTSE Developed. It trades about 0.0 of its total potential returns per unit of risk. Vanguard FTSE Developed is currently generating about 0.06 per unit of volatility. If you would invest 3,757 in Vanguard FTSE Developed on September 12, 2024 and sell it today you would earn a total of 1,067 from holding Vanguard FTSE Developed or generate 28.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Amundi Treasury Bond vs. Vanguard FTSE Developed
Performance |
| Timeline |
| Amundi Treasury Bond |
| Vanguard FTSE Developed |
Amundi Treasury and Vanguard FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi Treasury and Vanguard FTSE
The main advantage of trading using opposite Amundi Treasury and Vanguard FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi Treasury position performs unexpectedly, Vanguard FTSE 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 FTSE will offset losses from the drop in Vanguard FTSE's long position.| Amundi Treasury vs. Amundi EUR High | Amundi Treasury vs. Amundi Index Solutions | Amundi Treasury vs. Amundi MSCI Pacific | Amundi Treasury vs. Amundi MSCI Europe |
| Vanguard FTSE vs. Leverage Shares 2x | Vanguard FTSE vs. Amundi Index Solutions | Vanguard FTSE vs. Amundi Index Solutions | Vanguard FTSE vs. Albion Venture Capital |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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