Correlation Between Precious Metals and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Precious Metals and Ashmore Emerging 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 Precious Metals and Ashmore Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Precious Metals And and Ashmore Emerging Markets, you can compare the effects of market volatilities on Precious Metals and Ashmore Emerging 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 Precious Metals with a short position of Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Precious Metals and Ashmore Emerging.
Diversification Opportunities for Precious Metals and Ashmore Emerging
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Precious and Ashmore is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Precious Metals And and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets and Precious Metals 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 Precious Metals And are associated (or correlated) with Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Precious Metals i.e., Precious Metals and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Precious Metals and Ashmore Emerging
Assuming the 90 days horizon Precious Metals And is expected to generate 17.72 times more return on investment than Ashmore Emerging. However, Precious Metals is 17.72 times more volatile than Ashmore Emerging Markets. It trades about 0.41 of its potential returns per unit of risk. Ashmore Emerging Markets is currently generating about 0.15 per unit of risk. If you would invest 2,000 in Precious Metals And on November 3, 2024 and sell it today you would earn a total of 227.00 from holding Precious Metals And or generate 11.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Precious Metals And vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Precious Metals And |
| Ashmore Emerging Markets |
Precious Metals and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Precious Metals and Ashmore Emerging
The main advantage of trading using opposite Precious Metals and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Precious Metals position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging's long position.| Precious Metals vs. Victory Cemp Market | Precious Metals vs. Kinetics Market Opportunities | Precious Metals vs. Mid Cap 15x Strategy | Precious Metals vs. Siit Emerging Markets |
| Ashmore Emerging vs. Great West Loomis Sayles | Ashmore Emerging vs. Ultrasmall Cap Profund Ultrasmall Cap | Ashmore Emerging vs. Small Cap Value Fund | Ashmore Emerging vs. William Blair Small |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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