Correlation Between Vanguard FTSE and Jacob Forward
Can any of the company-specific risk be diversified away by investing in both Vanguard FTSE and Jacob Forward 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 Vanguard FTSE and Jacob Forward into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard FTSE Developed and Jacob Forward ETF, you can compare the effects of market volatilities on Vanguard FTSE and Jacob Forward 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 Vanguard FTSE with a short position of Jacob Forward. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard FTSE and Jacob Forward.
Diversification Opportunities for Vanguard FTSE and Jacob Forward
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vanguard and Jacob is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard FTSE Developed and Jacob Forward ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacob Forward ETF and Vanguard FTSE 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 Vanguard FTSE Developed are associated (or correlated) with Jacob Forward. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacob Forward ETF has no effect on the direction of Vanguard FTSE i.e., Vanguard FTSE and Jacob Forward go up and down completely randomly.
Pair Corralation between Vanguard FTSE and Jacob Forward
Considering the 90-day investment horizon Vanguard FTSE is expected to generate 34.06 times less return on investment than Jacob Forward. But when comparing it to its historical volatility, Vanguard FTSE Developed is 2.72 times less risky than Jacob Forward. It trades about 0.03 of its potential returns per unit of risk. Jacob Forward ETF is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 1,078 in Jacob Forward ETF on September 1, 2024 and sell it today you would earn a total of 187.00 from holding Jacob Forward ETF or generate 17.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Vanguard FTSE Developed vs. Jacob Forward ETF
Performance |
| Timeline |
| Vanguard FTSE Developed |
| Jacob Forward ETF |
Vanguard FTSE and Jacob Forward Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard FTSE and Jacob Forward
The main advantage of trading using opposite Vanguard FTSE and Jacob Forward positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard FTSE position performs unexpectedly, Jacob Forward 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 Jacob Forward will offset losses from the drop in Jacob Forward's long position.| Vanguard FTSE vs. iShares ESG Aggregate | Vanguard FTSE vs. SPDR MSCI Emerging | Vanguard FTSE vs. Aquagold International | Vanguard FTSE vs. Thrivent High Yield |
| Jacob Forward vs. iShares SP Mid Cap | Jacob Forward vs. iShares SP Small Cap | Jacob Forward vs. iShares SP Mid Cap | Jacob Forward vs. iShares 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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