Correlation Between Nasdaq 100 and Guggenheim Macro
Can any of the company-specific risk be diversified away by investing in both Nasdaq 100 and Guggenheim Macro 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 Nasdaq 100 and Guggenheim Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 Index Fund and Guggenheim Macro Opportunities, you can compare the effects of market volatilities on Nasdaq 100 and Guggenheim Macro 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 Nasdaq 100 with a short position of Guggenheim Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq 100 and Guggenheim Macro.
Diversification Opportunities for Nasdaq 100 and Guggenheim Macro
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nasdaq and Guggenheim is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Index Fund and Guggenheim Macro Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Macro Opp and Nasdaq 100 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 Nasdaq 100 Index Fund are associated (or correlated) with Guggenheim Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Macro Opp has no effect on the direction of Nasdaq 100 i.e., Nasdaq 100 and Guggenheim Macro go up and down completely randomly.
Pair Corralation between Nasdaq 100 and Guggenheim Macro
Assuming the 90 days horizon Nasdaq 100 Index Fund is expected to generate 10.09 times more return on investment than Guggenheim Macro. However, Nasdaq 100 is 10.09 times more volatile than Guggenheim Macro Opportunities. It trades about 0.12 of its potential returns per unit of risk. Guggenheim Macro Opportunities is currently generating about 0.29 per unit of risk. If you would invest 5,113 in Nasdaq 100 Index Fund on August 29, 2024 and sell it today you would earn a total of 147.00 from holding Nasdaq 100 Index Fund or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nasdaq 100 Index Fund vs. Guggenheim Macro Opportunities
Performance |
| Timeline |
| Nasdaq 100 Index |
| Guggenheim Macro Opp |
Nasdaq 100 and Guggenheim Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq 100 and Guggenheim Macro
The main advantage of trading using opposite Nasdaq 100 and Guggenheim Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq 100 position performs unexpectedly, Guggenheim Macro 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 Guggenheim Macro will offset losses from the drop in Guggenheim Macro's long position.| Nasdaq 100 vs. Balanced Fund Retail | Nasdaq 100 vs. Rbc Global Equity | Nasdaq 100 vs. Calamos Global Equity | Nasdaq 100 vs. Touchstone International Equity |
| Guggenheim Macro vs. Nasdaq 100 Index Fund | Guggenheim Macro vs. Artisan Thematic Fund | Guggenheim Macro vs. Growth Fund Of | Guggenheim Macro vs. Eic Value 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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